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Geopolitical risk and global supply chain resilience

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  • Chang, Xiaolu
  • Song, Zhipeng
  • Zhou, Tiansong

Abstract

Recent years have witnessed a rise in regional conflicts, which have heightened geopolitical uncertainty. The far-reaching consequences of geopolitical risk have attracted extensive attention from scholars and policymakers. In this research, we use a global supply chain dataset to reveal that geopolitical risk has greatly undermined global supply chain resilience. The effect is stronger in countries with weaker property rights protection. Our conclusions hold across various endogeneity and sensitivity checks. Moreover, we also document that reduced trade credit and increased inventory costs are important channels underpinning the relation. Overall, this paper enriches research on geopolitical risk and global supply chains.

Suggested Citation

  • Chang, Xiaolu & Song, Zhipeng & Zhou, Tiansong, 2025. "Geopolitical risk and global supply chain resilience," Finance Research Letters, Elsevier, vol. 86(PD).
    • Handle: RePEc:eee:finlet:v:86:y:2025:i:pd:s1544612325018057
    DOI: 10.1016/j.frl.2025.108551
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    References listed on IDEAS

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