Market efficiency and non-market distortions

Sam Mulopulos ()

Chapter 2 in Achieving Supply Chain Resilience, 2025, pp 41-79 from Edward Elgar Publishing

Abstract: This chapter discusses the ways in which supply chains can become vulnerable. Market-based vulnerabilities are a result of efforts by the market to maximize efficiency. Containerization, just-in-time processes, and trade liberalization all present improvements in supply chain efficiency, which have helped to globalize supply chains. This has diversified supply chains, but it has also has concentrated supply chains in ways that create vulnerabilities. Non-market vulnerabilities are created when non-market autocracies use state power to distort markets for their own benefit. China and Russia have used non-market practices to seize control of critical supply chain chokepoints, such as for critical minerals and energy, as well as to degrade the general industrial capabilities of market economies in ways that reduce their ability to respond to a supply chain disruption. Because non-market autocracies are geopolitically aggressive, their market distortions create unique supply chain risks from economic coercion and war.

Keywords: Just-in-time; Trade liberalization; China; Russia; Rare earth elements; Natural gas; Economic coercion (search for similar items in EconPapers)
Date: 2025
ISBN: 9781035349500
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