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Artificial intelligence policy and supply chain disruption risk: Evidence from innovation-driven and cost-saving effects

Author

Listed:
  • Pei, Tianyue
  • Chen, Xuesheng
  • Zheng, Liya

Abstract

This study investigates the impact of Artificial Intelligence (AI) policy on firms’ supply chain disruption risk. Prior research has focused on the effect of AI technology on supply chain risk, while paying less attention to the role of AI-related policies. Using data on Chinese listed firms from 2012 to 2024 and exploiting the implementation of China’s National AI Innovative and Application Pilot Zones as a quasi-natural experiment, we find that AI policy significantly reduces firms’ supply chain disruption risk. Our analysis reveals that the risk-mitigating effect operates through higher innovation investment and lower operating costs, and the aboveeffect is more pronounced for non-state-owned enterprises, smaller firms, and firms with more concentrated supply chains. Further analysis indicates that the risk-mitigating effect of AI policy generates spillovers along supply chains. This study offers practical insights for policy design to integrate technological progress with supply chain risk management.

Suggested Citation

  • Pei, Tianyue & Chen, Xuesheng & Zheng, Liya, 2026. "Artificial intelligence policy and supply chain disruption risk: Evidence from innovation-driven and cost-saving effects," Economic Modelling, Elsevier, vol. 160(C).
    • Handle: RePEc:eee:ecmode:v:160:y:2026:i:c:s0264999326001227
    DOI: 10.1016/j.econmod.2026.107593
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    Keywords

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    JEL classification:

    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis

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