Before revision:  Despite its importance in characterizing the production network of an economy, little is known about how the network revises its linkage structure in the face of global and individual exogenous shocks. Using a unique data set covering 10 years of interfirm buyer--seller networks and structural equation modeling, we show that the evolution of the interfirm buyer--seller network is a result of a firm's myopic decisions to avoid other firms ' negative shocks and share their positive shocks.
After revision:  Based on a data set describing the evolution of buyer--seller networks and structural equation modeling, we show that the evolution of the interfirm buyer--seller network is a result of a firm's myopic decisions to avoid other firms ' negative shocks and share their positive shocks.