Supply Shocks in Supply Chains: Evidence from the Early Lockdown in China

Chocs d’offre dans les chaînes de valeur: Enseignements du confinement en Chine

Raphael Lafrogne-Joussier, Julien Martin and Isabelle Mejean ()
Additional contact information
Raphael Lafrogne-Joussier: CREST-INSEE - Centre de Recherche en Economie et en Statistique - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz] - GENES - Groupe des Écoles Nationales d'Économie et Statistique - ENSAE Paris - École Nationale de la Statistique et de l'Administration Économique - GENES - Groupe des Écoles Nationales d'Économie et Statistique - IP Paris - Institut Polytechnique de Paris - INSEE - Institut national de la statistique et des études économiques (INSEE), INSEE - Institut national de la statistique et des études économiques (INSEE)
Julien Martin: UQAM - Université du Québec à Montréal = University of Québec in Montréal, CEPR - Center for Economic Policy Research
Isabelle Mejean: Sciences Po - Sciences Po, CEPR - Center for Economic Policy Research

Working Papers from HAL

Abstract: How do firms in global value chains react to input shortages? We examine micro-level adjustments to supply chain shocks, building on the COVID-19 pandemic as a case study. French firms sourcing inputs from China just before the early lockdown in the country experienced a relative drop in imports that increases from February to April 2020. This shock on input purchases transmits to the rest of the supply chain through exposed firms' domestic and export sales. Between February and June, firms exposed to the Chinese early lockdown experienced a 5.5% drop in domestic sales and a 5% drop in exports, in relative terms with respect to comparable non-exposed firms. The drop in foreign sales is entirely attributable to a lower volume of exports driven by a temporary withdrawal from occasional markets. We then dig into the heterogeneity of the transmission across treated firms. Whereas the ex-ante geographic diversication of inputs does not seem to mitigate the impact of the shock, firms with relatively high inventories have been able to absorb the supply shock better.

Keywords: Covid-19 pandemic; Global Value Chains Classification; Transmission of shocks; Supply chain disruptions; Pénurie d'intrants; Transmission de chocs; Disruptions de chaînes de valeur; Pandémie de Covid-19 (search for similar items in EconPapers)
Date: 2023-04
Note: View the original document on HAL open archive server: https://insee.hal.science/hal-05354484v1
References: Add references at CitEc
Citations:

Downloads: (external link)
https://insee.hal.science/hal-05354484v1/document (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:wpaper:hal-05354484

Access Statistics for this paper

More papers in Working Papers from HAL
Bibliographic data for series maintained by CCSD ().