The impact of social capital on major customer supply chain power
Date
2024
Authors
Ullah, G.M.W.
Cavoli, T.
Khan, I.
Abdullah, M.
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Journal article
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Economics Letters, 2024; 238(111725):1-5
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Abstract
Abstract: We investigate the impact of regional social capital on firms' ability to attain bargaining power over their supply chain partners. Using ordinary least squares and instrumental variables estimations, we find a positive relationship between firm-level supply chain power and US county-level social capital. Additionally, we observe this positive effect to be stronger for firms in durable goods manufacturing and the services industry, but not for nondurable goods manufacturers. We conclude that firms headquartered in US counties with high social capital are preferred by suppliers, resulting in greater supply chain power.
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Copyright 2024 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY license. (http://creativecommons.org/licenses/by/4.0/)