Geopolitical risk and the re-routing of supply chains
Geopolitical risk is one of the most frequent keywords in the finance and economics journals, and supply chain resilience is a major topic in operations research, but the two rarely meet in OR journals. Customs data can show whether trade re-routes through third countries when geopolitical risk rises, and at what cost.
What prompted this
Since October 2025, 445 papers carry a geopolitical keyword (202 in finance journals, 167 in economics), and "supply chain resilience" appears on 233 (95 in operations research). Only 50 papers carry both kinds of keyword, and only 8 of them are in operations research journals. In the last 30 days "geopolitical risk" is the 31st most frequent keyword.
Questions
- After geopolitical shocks such as sanctions or tariff rounds, how much trade moves to connector countries rather than disappearing?
- Does re-routing show up in costs and lead times, for example in unit values and shipping times?
- Which network-design models in the OR literature predict the re-routing that actually happens?
Data that could help
- UN Comtrade or CEPII BACI flows, Chinese customs records and tariff data (the international trade category of the dataset ranking).
- The Geopolitical Risk index of Caldara and Iacoviello.
- A gravity model with exporter-year, importer-year and pair fixed effects (see the equation ranking).
Next step
Estimate a gravity model for 2015–2025 with the geopolitical risk index interacted with political alignment, and look for trade diverted to third countries.