Assessing the Supply Chain Effect of Natural Disasters: Evidence from Chinese Manufacturers

70 Pages Posted: 18 Jun 2022

See all articles by Katharina Laengle

Katharina Laengle

affiliation not provided to SSRN

Ankai Xu

Graduate Institute of International and Development Studies (IHEID); World Trade Organization (WTO)

Ruijie Tian

University of Gothenburg

Abstract

To what degree can adverse shocks propagate along global value chains? Investigating the international propagation of the US hurricane season in 2005, we show that Chinese processing manufacturers with tight trade linkages to the United States reduced their US intermediate imports between July and October 2005, leading to a temporary decline of exports. However, we do not find consistent evidence of international propagation of supply shocks along global value chains. Moreover, we find that firms with more diversified suppliers tend to be less affected, pointing to sourcing diversification as a way to increase resilience to adverse shocks.

Keywords: production networks, resilience, diversification, shock transmission, supply chains, natural disasters

Suggested Citation

Laengle, Katharina and Xu, Ankai and Tian, Ruijie, Assessing the Supply Chain Effect of Natural Disasters: Evidence from Chinese Manufacturers. Available at SSRN: https://ssrn.com/abstract=4139996 or http://dx.doi.org/10.2139/ssrn.4139996

Katharina Laengle

affiliation not provided to SSRN ( email )

No Address Available

Ankai Xu (Contact Author)

Graduate Institute of International and Development Studies (IHEID) ( email )

PO Box 136
Geneva, CH-1211
Switzerland

World Trade Organization (WTO) ( email )

Rue de Lausanne 154
Geneva 21, CH-1211
Switzerland

Ruijie Tian

University of Gothenburg ( email )

Viktoriagatan 30
Göteborg, 405 30
Sweden

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