Bound by ancestors: Immigration, credit frictions, and global supply chain formation

• 成果类型: Article
• 署名作者: Choi, Jaerim; Hyun, Jay; Park, Ziho
• 署名单位: Yonsei University; Universite de Montreal; HEC Montreal; National Taiwan University; Universite de Montreal; HEC Montreal; Yonsei University; National Taiwan University
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2023.103855
• 发表日期: 2024
• 关键词: immigration; Global supply chain; Global value chain; network formation; Co-ethnic networks; social ties; Trade credit; credit constraints

摘要

This paper shows that the ancestry composition shaped by century-long immigration to the US can explain the current structure of global supply chains. Using an instrumental variable strategy combined with a novel dataset that links firm-to-firm global supply chains with their location information and historical migration data, we find that the co-ethnic networks have a positive causal impact on global supply chain relationships between foreign countries and US counties. The positive impact not only exists in supplier-customer relationships but also extends to strategic partnerships and trade in services. The positive impact is stronger in counties in which a larger number of firms are credit constrained, and such a stronger effect becomes even more pronounced when foreign firms are located in countries with weak contract enforcement. The results suggest that co-ethnic networks serve as social collateral to overcome credit constraints and facilitate global supply chain formation.