Abstract:Against the backdrop of promoting regional coordinated development and establishing a unified national market, this paper investigates how market integration affects firms’interregional supply chain networks. We first develop a theoretical framework that endogenizes firms’adjustments of supply chain relationships, revealing how the unified national market optimizes interfirm cooperation by reducing transaction costs and improving matching efficiency. Based on this framework, we construct a“supplier-customer-year”panel dataset covering the period 2013-2021, and use a province-level market integration index as the key explanatory variable. Employing instrumental variable strategies to identify causal effects, we find that the development of a unified national market significantly increases the likelihood of firms establishing interregional supply chain relationships. Mechanism analysis shows that this effect operates mainly through two channels: (1) the cost mechanism, whereby improved cross-regional flows of goods and production factors lower collaboration costs; and (2) the risk mechanism, whereby enhanced resilience mitigates supply chain disruption risks. This study deepens the understanding of supply chain network restructuring under the“domestic circulation”development paradigm and provides both theoretical and empirical support for improving the institutional foundations of a unified national market.