Abstract

Purpose: This investigation examines the non-linear relationship between macroeconomic volatility and distribution financing decisions through threshold analysis of Vietnamese distribution firms (2010-2024). Research design, data and methodology: We introduce the Distribution Resilience Financing (DRF) Framework, incorporating Institutional Buffering Capacity (IBC) as a threshold variable and employing dynamic panel threshold regression (DPTR) and panel vector autoregression (PVAR) methodologies to identify distinct institutional regimes with heterogeneous financing adjustment dynamics. Results: The findings reveal that high-IBC environments facilitate 127% faster adjustment speeds in distribution financing decisions, whilst enabling firms to maintain higher optimal leverage ratios for inventory management and supply chain operations. The macroeconomic volatility-distribution financing relationship exhibits significant regime dependence, with volatility impacts diminishing as institutional quality improves. Sectoral analysis demonstrates that logistics firms exhibit greater sensitivity to volatility than retailing operations, with more substantial adjustments to their Volatility-Adjusted Optimal Capital Structure (VAOCS) during turbulent periods. COVID-19 represents a structural break, necessitating reconsideration of distribution financing theory within emerging market contexts. Conclusions: These findings establish institutional quality not merely as a background factor, but as a primary, regime-dependent driver of financial resilience in distribution networks, offering critical lessons for strategic management and policymaking in emerging economies.