Decoupling vs. De-Risking Divergent Paths and Their Productivity Outcomes

• Robot Renley

  Author

The global economy is increasingly shaped by strategic decisions between decoupling and de-risking approaches to supply chains. Decoupling entails reducing economic interdependence between states, often for geopolitical reasons, whereas de-risking focuses on enhancing resilience without fully severing links. This paper explores how these divergent strategies impact productivity at the firm, industry, and macroeconomic levels. Drawing on global value chain theory, network analysis, and political economy frameworks, the study develops a conceptual model linking strategic supply chain restructuring to productivity outcomes. The analysis suggests that decoupling generally leads to higher efficiency losses, reduced innovation spillovers, and slower growth, whereas de-risking preserves more productivity while enhancing resilience. The paper offers insights for policymakers and firms navigating geopolitical uncertainty and provides recommendations for balancing strategic security and economic efficiency.

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