Industrial Metal Supply Shocks and Heterogeneous Macroeconomic Effects: Evidence from Copper

Andrea Bastianin, Luca Rossini and Alessandra Testa

No 387620, FEEM Working Papers from Fondazione Eni Enrico Mattei (FEEM)

Abstract: This paper studies the macroeconomic effects of global copper supply shocks. We identify exogenous disruptions to copper supply using a Bayesian structural VAR of the world copper market that combines sign and narrative restrictions. We then trace the international transmission of the identified shock using a two-step approach based on country-level models for major copper-importing and exporting economies. We find that copper supply shocks raise producer prices and depress industrial activity in importing economies, while exporters benefit from higher world prices through improved terms of trade. Importer-exporter status alone is insufficient to characterize exposure: heterogeneity in responses reflects differences in manufacturing copper intensity and buffering capacity through secondary copper production.

Keywords: Climate Change; Environmental Economics and Policy; Land Economics/Use; Resource/Energy Economics and Policy; Sustainability (search for similar items in EconPapers)
Pages: 51
Date: 2026-01-13
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Persistent link: https://EconPapers.repec.org/RePEc:ags:feemwp:387620

DOI: 10.22004/ag.econ.387620

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