Supply Chain Risk and the Pattern of Trade

Working Paper
Published on 28 April 2016

Abstract

In this paper, Eber and Malmberg (2015) analyze the interaction of supply chain risk and trade patterns. They show theoretically that countries with low supply chain risk can be expected to specialize in goods with a large number of customized inputs, since those goods are most sensitive to disruption. Then, they test this prediction using industry level trade data and find that countries with low supply chain risk disproportionately export risk-sensitive goods.