How effective is lithium recycling as a remedy for resource scarcity?

Knut Einar Rosendahl and Diana Roa Rubiano ()
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Diana Roa Rubiano: School of Economics and Business, Norwegian University of Life Sciences, Postal: Norwegian University of Life Sciences, School of Economics and Business, P.O. Box 5003 NMBU, N-1432 Ås, Norway

No 3-2018, Working Paper Series from Norwegian University of Life Sciences, School of Economics and Business

Abstract: We investigate to what extent recycling can remedy resource scarcity, and whether market intervention is desired. For doing so, we develop a dynamic model of the global lithium market. An efficient market for resource waste allows consumers to internalize the waste value when they buy the resource. In the analytical part of our paper, we show that the efficient market can alternatively be realized through a proper set of worldwide subsidies to either buyers or sellers of both virgin and recycled lithium. In our numerical simulations, we find that optimal subsidies may become quite substantial in the second half of this century. The size of these subsidies depends, however, on a number of uncertain assumptions such as technological progress in both extraction and recycling, quality-grade of recovered lithium, and demand elasticity.

Keywords: Natural Resource Economics; Exhaustible resources; Minerals; Recycling (search for similar items in EconPapers)
JEL-codes: L72 Q30 Q40 Q53 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2018-04-13, Revised 2018-04-16
New Economics Papers: this item is included in nep-env
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https://www.nmbu.no/download/file/fid/31502 Full text (application/pdf)

Related works:
Journal Article: How Effective is Lithium Recycling as a Remedy for Resource Scarcity? (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:nlsseb:2018_003

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