Creative Destruction in Supply Chains: Measuring “Constructive Redundancy” for Growth and Resilience

Baqaee and Burstein (2022) center creative destruction at the level of supply chains, yet we still lack operational metrics for when restructuring actually raises growth rather than just adds churn. This project proposes a “Constructive Redundancy Index” that quantifies modularity, substitutability, and multi-sourcing in firm-level supply networks, and tests whether deliberately adding “slack” links accelerates post-shock reallocation and innovation. The novelty is twofold: (i) shifting the unit of analysis from firms/sectors to the micro-topology of supply networks, and (ii) integrating data nonrivalry as a catalyst for composability—leveraging Liao et al. (2023) to hypothesize that sectors with data-sharing and analytics capacity (Sultana et al., 2021) experience faster, less destructive reconfiguration. We’ll reconcile conflicting SME results from Indonesia—where local adaptation and assistance did not moderate scalability under creative destruction (Mujahid et al., 2024)—by testing whether network-level redundancy, not local adaptation, is the true moderator. This reframes resilience as a growth lever: optimized redundancy could transform destruction into a predictable productivity step, informing industrial policy (Kalvet, 2016) and private supply-chain strategy.

References:

1. Growth Through Creation and Destruction of Supply Chains. D. Baqaee, Ariel T. Burstein (2022).
2. Creative destruction, human capital accumulation, and growth in a digital economy. Lewei Liao, Xuezheng Qin, Xiaolong Li, Liutang Gong (2023). Macroeconomic Dynamics.
3. Architecting and Developing Big Data-Driven Innovation (DDI) in the Digital Economy. Saida Sultana, Shahriar Akter, Elias Kyriazis, S. Wamba (2021). Journal of Global Information Management.
4. FROM INNOVATION TO MARKET: INVESTIGATING THE SCALABILITY OF FOOD SMEs IN EMERGING ECONOMIES THROUGH CREATIVE DESTRUCTION. Mujahid, ST. Rukaiyah, Nurmadhani Fitri Suyuthi, Rosnaini Daga, Abdul Samad Arief (2024). Jurnal Bisnis dan Akuntansi.
5. Innovation Policy and Development in the ICT Paradigm: Regional and Theoretical Perspectives. Tarmo Kalvet (2016).