Regulatory Trade Risk and Supply Chain Strategy

• 成果类型: Article
• 署名作者: Wang, Yimin; Gilland, Wendell; Tomlin, Brian
• 署名单位: Arizona State University; Arizona State University-Tempe; University of North Carolina; University of North Carolina Chapel Hill; Dartmouth College
• 刊物名称: PRODUCTION AND OPERATIONS MANAGEMENT
• ISSN/ISSBN: 1059-1478
• DOI: 10.1111/j.1937-5956.2010.01167.x
• 发表日期: 2011
• 页码: 522-540
• 关键词: regulatory trade risk; Non-tariff barrier; DUAL SOURCING; supply chain

摘要

Trade regulations are an important driver of supply chain strategy in many industries. For example, the textile, paper, chemical, and steel industries grapple with significant levels of non-tariff barriers (NTBs) such as safeguard controls and countervailing duties. We explore three often observed supply chain strategies in industries subject to NTBs; direct procurement, split procurement, and outward processing arrangements (OPAs). We characterize the optimal procurement quantities for each of these three strategies, and examine how industry and country characteristics influence the firm's strategy preference. For example, we establish that the direct and split strategy profits increase in the NTB price variance but decrease in the mean price. These effects are sufficiently large that NTB price characteristics can dictate which supply chain strategy is preferred. Both the cost disadvantage and lead-time advantage of domestic production are also significant influencers of the preferred strategy, as is the domestic-country mandated production constraint associated with the OPA strategy.