Weak links in supply chains are weaponised
The paper uses economic models to test networks’ robustness to external shocks or attacks
How would an energy embargo affect Germany’s economy?
Professor Carvalho's research is detailed in the article, examining the impact on the affected areas from the ripple effects which occur along supply chains. It finds that the latter accounted for more than half the hit to Japanese growth.
The article then details research which Professor Elliott's paper shows, that firms often look at a business case to invest in the robustness of their supply chains. However, these companies sometimes fail ensure the resilience of the wider network, because they do not stand to reap the rewards from such investment.
Building resilient supply chains
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Related papers:
From Micro to Macro via Production Networks, Carvalho, V. (2014) Journal of Economic Perspectives, 28, no. 4.
Project Syndicate: Supply-Shock Therapy
The world has recently experienced a cascade of supply-chain disruptions, and further disruptions are likely to impact consumers this Christmas, with widespread shortages emerging around the world.
How Supply Chain Disruptions Led to a Wide Economic Impact of 2011 Japan Earthquake
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New research co-authored by Professor Vasco Carvalho, uncovers the role of complex and lengthening supply chains play in propagating the impact of disruptions brought about by local disturbances, such as natura