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How climate change affects enterprise inventory management —— From the perspective of regional traffic

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  • He, Xin
  • Xu, Xinwei
  • Shen, Yu

Abstract

Today, climate change has intensified and seriously impacts economic development with more disasters. Therefore, how climate change affects business management is an innovative topic of global concern and becomes our main research purpose. Combined with theoretical analysis, we use the unique Chinese manufacturers and climate disasters data from 2003 to 2013 to conduct empirical research. Using inventory management as the business proxy, we find that the enterprise’s total inventory is prominently affected by climate risk. With 1% rise in climate disaster loss, total inventory will increase by 0.0044%. However, the impact of climate risk on finished and non-finished products are different. In addition, we find climate impact on enterprise inventory can be mitigated by better traffic condition. Furthermore, industrial spatial agglomeration can effectively alleviate the pressure of climate risk. This study obtains original conclusions, provides a new micro-perspective and policy suggestions to optimize inventory and business management under climate change.

Suggested Citation

  • He, Xin & Xu, Xinwei & Shen, Yu, 2023. "How climate change affects enterprise inventory management —— From the perspective of regional traffic," Journal of Business Research, Elsevier, vol. 162(C).
    • Handle: RePEc:eee:jbrese:v:162:y:2023:i:c:s0148296323002229
    DOI: 10.1016/j.jbusres.2023.113864
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