IDEAS home Printed from https://ideas.repec.org/a/eee/finlet/v82y2025ics1544612325008980.html
   My bibliography  Save this article

Connect to certainty: Domestic trade network and trade policy uncertainty

Author

Listed:
  • Bao, Xiaohua
  • Gao, Deting
  • Wei, Yaning
  • Wu, Wentao
  • Zhang, Jie

Abstract

Amid rising geopolitical tensions and frequent changes in trade policies, trade policy uncertainty (TPU) poses a major challenge for global businesses. This paper empirically examines how firms' domestic trade networks influence their perception of TPU, using a unique dataset of supplier-customer relationships from Chinese listed companies. We find that an increase in network centrality reduces perceived TPU. Further analysis suggests that domestic trade networks mitigate TPU primarily by reducing informational frictions and alleviating financing constraints. This study provides evidence that domestic trade networks can mitigate firms' foreign risks and contributes to a deeper understanding of the precise measurement and determinants of TPU.

Suggested Citation

  • Bao, Xiaohua & Gao, Deting & Wei, Yaning & Wu, Wentao & Zhang, Jie, 2025. "Connect to certainty: Domestic trade network and trade policy uncertainty," Finance Research Letters, Elsevier, vol. 82(C).
    • Handle: RePEc:eee:finlet:v:82:y:2025:i:c:s1544612325008980
    DOI: 10.1016/j.frl.2025.107639
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1544612325008980
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.frl.2025.107639?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    More about this item

    Keywords

    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finlet:v:82:y:2025:i:c:s1544612325008980. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/frl .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.