This empirical study provides evidence linking supply
chain strategy and company risk structure. An event
study on the stock performance of four major PC
producers is performed focusing on the 1999 earthquake
in Taiwan and the computer memory price increases that
ensued. It is shown that investors associate pull-type
supply chains for PCs with lower profitability after
abrupt component price increases. A parallel analysis of
push-type producer stock returns does not show similar
results. Furthermore, in depth analysis of Dell Computer
reveals that after the catastrophe-induced disruption
the onset of losses to this major pull-type PC producer
was very fast. Far from condemning pull-type PC supply
chains, earthquake-induced disruptions, like the one
researched, pose manageable risks. pdf
