Does supply chain network centrality affect stock price crash risk? Evidence from Chinese listed manufacturing companies

This study develops a social network analysis to examine the influence mechanisms of supply chain network position on stock price crash risk. With a panel of 2115 Chinese A-share listed manufacturing companies from 2013 to 2019, we construct a large-sample weighted supply chain network. By shedding light on the centrality of this supply chain network, this article finds that network centrality has a significantly negative effect on stock price crash risk. Further influence channel examinations reveal that higher network centrality reduces information asymmetry and improves investor sentiment, thus decreasing stock price crash risk. However, the operational risk is not a significant channel for the effect of network centrality on stock price crash risk. This study provides theoretical and empirical evidence for the influencing factors of stock price crash risk at the supply chain network level.