CMI researchers at Colorado School of Mines conducted the research for this highlight
Developed a general equilibrium model to assess the short-run impacts of a Chinese export restriction on refined cobalt, capturing ripple effects into U.S. vehicle production, and ultimately, the U.S. consumer. Quantifies the macroeconomic costs to the U.S. economy.
Significance and Impact
- Illustrates channels by which the U.S./global economies might respond to a supply disruption, quantifying their impacts.
- New methods for exploring global energy-minerals issues that can be expanded or used to inform future quantitative models.
- A disruption to Chinese refined cobalt supply could be costly to the U.S. economy. 2017, the cost would have been small, less than 0.01% of personal consumption expenditures. In 2030, costs will be highly sensitive to regional cobalt production and vehicle substitution patterns.
- Technological substitution could help avoid 30–90% of costs depending on the scenario.
- International trade with non-Chinese regions plays a major cost reducing role for the U.S.