Abstract
In this paper, we study the topological properties of the global supply chain network in terms of its degree distribution, clustering coefficient, degree-degree correlation, bow-tie structure, and community structure to test the efficient supply chain propositions proposed by E. J.S. Hearnshaw et al. The global supply chain data in the year 2017 are constructed by collecting various company data from the web site of Standard & Poor's Capital IQ platform. The in- and out-degree distributions are characterized by a power law of the form of γin = 2.42 and γout = 2.11. The clustering coefficient decays [Formula: see text] with an exponent βk = 0.46. The nodal degree-degree correlations 〈knn(k)〉 indicates the absence of assortativity. The bow-tie structure of giant weakly connected component (GWCC) reveals that the OUT component is the largest and consists 41.1% of all firms. The giant strong connected component (GSCC) is comprised of 16.4% of all firms. We observe that upstream or downstream firms are located a few steps away from the GSCC. Furthermore, we uncover the community structures of the network and characterize them according to their location and industry classification. We observe that the largest community consists of the consumer discretionary sector based mainly in the United States (US). These firms belong to the OUT component in the bow-tie structure of the global supply chain network. Finally, we confirm the validity of Hearnshaw et al.'s efficient supply chain propositions, namely Proposition S1 (short path length), Proposition S2 (power-law degree distribution), Proposition S3 (high clustering coefficient), Proposition S4 ("fit-gets-richer" growth mechanism), Proposition S5 (truncation of power-law degree distribution), and Proposition S7 (community structure with overlapping boundaries) regarding the global supply chain network. While the original propositions S1 just mentioned a short path length, we found the short path from the GSCC to IN and OUT by analyzing the bow-tie structure. Therefore, the short path length in the bow-tie structure is a conceptual addition to the original propositions of Hearnshaw.
Highlights
National economies are linked through international trade so the globalized economy forms a large economic complex network characterized by strong links, i.e., interactions due to increasing level of trade between countries worldwide
Standard & Poor’s offers various company-level data in accordance with customers’ demands, such as detailed company descriptions, In this paper, we study the topological properties of the global supply chain network in terms of its degree distribution, clustering coefficient, degree-degree correlation, bow-tie structure, and community structure to test the efficient supply chain propositions proposed by E
While the original propositions S1 just mentioned a short path length, we found the short path from the giant strong connected component (GSCC) to IN and OUT by analyzing the bow-tie structure
Summary
National economies are linked through international trade so the globalized economy forms a large economic complex network characterized by strong links, i.e., interactions due to increasing level of trade between countries worldwide. If we view the globalized world economy with a high resolution or a microscopic view, we might notice that this large economic network consist of a global supply chain comprised of a large number of firms. Some examples of the collective motions of the global economy include the synchronization of the business cycle, global economic crises, and chain bankruptcies. These collective motions occur due to the strong interactions between constituent elements. It is expected that various collective motions will emerge in the globalized world economy under the condition of trade liberalization, i.e. globalization
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