Abstract: Financial Intermediation, Sustainable Banking and Marketing

Abstract:
We aim to explore the application of compartmental models originally developed in epi- demiology to the anal ysis of economic and financial dynamics, such as banking contagion and market panics. These models divide a system into subpopulations (for example, solvent or defaulting agents) to represent systemic instability in an aggregate and structured way. This work proposes integrating these models with optimal control theory, a mathematical approach that enables regulators or private actors to design effective intervention strategies such as liquidity injections or interest rate adjustments to contain the spread of financial risk while minimizing costs and adhering to dynamic constraints. The objective is to develop a unified framework that combines com partmental modeling and optimal control, specifi- cally tailored to financial contagion. The goal is to quantify the trade-offs between financial stability and the cost of interventions.