Asia Economics Blog


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Supply Chain Credit Risk under the Pandemic: Evidence from US Networks with China

Co-authors:  John R. Birge; Zi'ang Wang; Jing Wu
This post draws from a paper to be presented in the ACAES session on Asian Economies in Global Supply Chains at the 2023 Allied Social Science Association Annual Meeting, program here.

The vulnerability of global supply chains and their impact on the economy has become a central issue during the current COVID-19 pandemic. While global supply chains allow firms to outsource production more cost effectively, they also expose firms to developments in the local economies where supply chain partners are located. During the recent COVID-19 pandemic, countries took measures to contain the pandemic through shutdowns and social distancing mandates. These measures created disruptions for local firms and their supply chain partners located in different regions. Disruptions in supply chains adversely affected production for downstream firms, and financial flows for upstream firms, creating major vulnerabilities for firms connected within a production network.

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