Strengthening economic resilience in manufacturing: The role of inclusive finance in supply chain sustainability

In the context of high uncertainties in the global economic environment, enhancing firms’ sustainable development capability within supply chains from the perspective of inclusive finance is crucial. In this study, we explore the differences in economic resilience between manufacturing and service industries in response to risk shocks, with a focus on the role of inclusive finance. Through an empirical analysis of Chinese A-share listed companies, we find that an increase in the number of suppliers weakens manufacturing firms’ economic resilience, but it has no significant impact on service firms. This is because an increased number of suppliers in manufacturing reduces the substitutability of intermediate goods, thus affecting total factor productivity. This effect is especially pronounced in cities outside urban agglomerations, in cities where the product market is underdeveloped but the factor market is well developed, in asset-intensive industries and amongst firms facing high financing constraints, with extensive overseas operations and low innovation capacity. Nevertheless, the development of inclusive finance can effectively mitigate the negative impact of an increased number of suppliers on manufacturing firms’ resilience, particularly in enhancing payment efficiency and security. This study provides an inclusive finance perspective to strengthen manufacturing firms’ resilience within supply chains and address the challenges posed by global sustainable development.