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Does supply chain finance affect cost elasticity?

Author

Listed:
  • Song, Yunling
  • Bai, Jialing
  • Li, Zhaoxue

Abstract

Results based on Chinese A-share manufacturing firms from 2010 to 2024 suggest that supply chain finance can significantly increase cost elasticity. The reduction in congestion risk is the main mechanism through which supply chain finance affects cost elasticity because supply chain finance can strengthen upstream business stability, lower transaction costs, and improve corporate specialization. The impact of supply chain finance on cost elasticity mainly occurs in observations with higher congestion risk concerns. These findings provide insights into how firms can proactively utilize supply chain finance to optimize cost structures and enhance operational resilience.

Suggested Citation

  • Song, Yunling & Bai, Jialing & Li, Zhaoxue, 2026. "Does supply chain finance affect cost elasticity?," Finance Research Letters, Elsevier, vol. 102(C).
  • Handle: RePEc:eee:finlet:v:102:y:2026:i:c:s1544612326006240
    DOI: 10.1016/j.frl.2026.110095
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