Heatwaves and Systemic Vulnerability: An Empirical Assessment of Global Supply Chains Resilience

ABSTRACT The increasing frequency and intensity of heatwaves pose a systemic threat to global supply chains; however, empirical evidence on their cascading impacts remains limited. This study investigates how heatwaves undermine global supply chain resilience. Employing a novel Apparent Heat Index that integrates temperature, humidity, and population exposure, we analyze panel data from 73 economies (1995–2020). Our findings reveal that heatwaves significantly reduce overall supply chain resilience, with the demand side being particularly vulnerable. Mechanism analyses identify three transmission pathways: reduced trade competitiveness, policy‐driven resource misallocation, and weakened global value chains participation with lower network redundancy. Heterogeneity analyses show these effects are more pronounced in middle‐income countries, temperate zones, and digitally intensive or knowledge‐based sectors. The results underscore the need for climate‐resilient infrastructure, diversified trade networks, and tailored adaptation policies to mitigate systemic vulnerabilities.