A Simulation Framework For Studying Foreign Reliance On Regional Supply Chains At The Industry Level

ABSTRACT

Simulations incorporating economic input/output models have been applied recently to assess the extent of labor shocks from COVID 19 and their impact on supply chains at the macro level. Research is being done to extend these simulations for application to other scenarios of economic shocks beyond what was triggered through COVID related labor reductions. The problem of foreign supply chain dependency is of particular concern to localized regions as a significant portion of their economy is dependent on supplies from overseas. The extended simulation approach proposed here aims to optimize the degree to which the increased inventory supply targets allow for improved economic productivity and the ideal allocation per industry which most efficiently achieves this mitigation. This paper considers the application of the proposed simulation framework to study the regional dependence on the Asian supply chain. The case study presented in this paper demonstrates the economic insight that can be obtained through simulation analysis to support regional government decision making for the state of Alabama. © 2022 SCS.