Thats a unique idea.You should consider the following idea to enhance your idea so that it would impact uniquely:  develop a structural model of credit risk in a network economy, where any firm can lend to any other firm, so that each firm is subject to counterparty risk either from direct borrors or from remote firms in the network. This model takes into account the role of each firm's cash management.  show that  can obtain a semiclosed form formula for the price of debt and equity when cash accounts are buffers to bankruptcy risk. As in other structural models, the strategic bankruptcy decision of shareholders drives credit spreads, and differentiates debt from equity. Cash-flow risk also causes credit-risk interdependencies beten firms. Our model applies to the case where not only financial flows but also operations are dependent across firms.  use queueing theory to obtain our semiclosed form formulae in steady state.  perform a simplified implementation of our model to the U.S. automotive industry, and show how  infer the impact on a supplier's credit spreads of revenue changes in a manufacturer or even in a large car dealer.  also obtain prices for first-to-default and second-to-default basket credit default swaps.
['Didier Cossin', 'Henry Schellhorn']
I am writing a research paper on a idea Credit Risk in a Network Economy
[{"from": "human", "value": "I am writing a research paper on a idea Credit Risk in a Network Economy"}, {"from": "gpt", "value": "Thats a unique idea.You should consider the following idea to enhance your idea so that it would impact uniquely:  develop a structural model of credit risk in a network economy, where any firm can lend to any other firm, so that each firm is subject to counterparty risk either from direct borrors or from remote firms in the network. This model takes into account the role of each firm's cash management.  show that  can obtain a semiclosed form formula for the price of debt and equity when cash accounts are buffers to bankruptcy risk. As in other structural models, the strategic bankruptcy decision of shareholders drives credit spreads, and differentiates debt from equity. Cash-flow risk also causes credit-risk interdependencies beten firms. Our model applies to the case where not only financial flows but also operations are dependent across firms.  use queueing theory to obtain our semiclosed form formulae in steady state.  perform a simplified implementation of our model to the U.S. automotive industry, and show how  infer the impact on a supplier's credit spreads of revenue changes in a manufacturer or even in a large car dealer.  also obtain prices for first-to-default and second-to-default basket credit default swaps."}]