ABSTRACT
We estimate the relationship between firms' production flexibility and profitability under extreme positive demand shocks using the European toilet paper manufacturing industry in 2020 as a case study. This industry faced extreme increases in demand due to consumers panic purchasing toilet paper after the outbreak of the COVID-19 pandemic. Our estimates show that flexibility and profitability are positively related. This is even more pronounced in times of an extreme positive demand shock when a ten percent improvement in flexibility is associated with a five percent increase in profitability. © 2022 Elsevier B.V.
ABSTRACT
AFRICAN DEVELOPMENT Abstract: Despite pleas from international organizations, governments and trade economists to refrain from imposing trade-distorting measures, over 20 countries have implemented bans on the export of agri-food products since the onset of the COVID-19 crisis. These export prohibitions might adversely impact food security and disrupt well-established global supply chains. We identify importing countries that could potentially be affected by the imposed export bans using a measure of their import dependency during the pre-pandemic period to illustrate our results on global trade maps. We find that many importers rely on just one country for a significant share of the overall domestic supply of a particular commodity