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on Mining |
| By: | Henrekson, Magnus (Research Institute of Industrial Economics (IFN)) |
| Abstract: | This study critically examines HYBRIT (Hydrogen Breakthrough Ironmaking Technology), a Swedish flagship project—led by the government-owned iron ore company LKAB—to produce fossil-free sponge iron using hydrogen from fossil-free electricity. Positioned as a cornerstone of the EU Green Deal and Sweden’s green industrial transition, HYBRIT promised CO₂ reductions significantly exceeding Sweden’s current total emissions, but entailed unprecedented technological, economic, and infrastructural challenges. The analysis situates HYBRIT within the broader trend of “moonshot” industrial policies, emphasizing their susceptibility to political enthusiasm, rent-seeking, and disregard for opportunity costs. Technologically, the project required large-scale hydrogen production, storage, and industrial adaptation, unproven at a commercial scale. Economically, profitability hinged on exceptionally low electricity prices and high CO₂ emission costs—conditions unlikely to persist—while facing intensifying global competition in the green steel sector. Electricity supply constraints, particularly in northern Sweden, compounded feasibility concerns. Political, regional, and corporate interests aligned to advance HYBRIT despite these risks, aided by limited external scrutiny of state-owned firms. Growing criticism and competing priorities eventually led LKAB to defer its sponge iron ambitions indefinitely, reframing its strategy around high-grade ore and the extraction of rare earth metals and phosphorus. The case illustrates the pitfalls of mission-oriented policies when technological and market realities are subordinated to political symbolism, underscoring the need for rigorous, independent evaluation of large-scale green industrial projects. |
| Keywords: | Green deals; Green steel; Hydrogen; Mission-oriented policies; Moonshots; Public choice; Rent-seeking |
| JEL: | L20 L52 L70 O38 Q28 Q48 |
| Date: | 2025–12–11 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:iuiwop:1546 |
| By: | Stern, David I. |
| Abstract: | I attempt to measure whether the mining sector contributes to the achievement of sustainable development or detracts from that goal in a number of developing countries. Most economic interpretations of sustainability regard sustainable development as development that provides for a non-decreasing level of welfare in the long-run. Treating income per capita as an imperfect proxy of welfare we can measure whether increases in mining sector income lead to sustainable increases in income despite the exhaustible nature of mineral deposits. This is a more encompassing criterion than the conventional Solow-Hartwick criterion which sets necessary conditions for the achievement of a similar definition of sustainability. A seven variable vector autoregression model (VAR) is estimated for each of nineteen non-OPEC developing countries with large mining sectors. The variables are mining GDP, non-mining GDP, net foreign factor payments, imports, manufactured capital, labor, and an index of human capital. Other aspects of the natural environment are treated as unobserved variables that may systematically affect parameter estimates or affect the random error terms. Using the impulse response functions, I determine the long-run multiplier of mining income on GNP. Information is also provided on the multipliers of the mining sector on manufactured and human capital accumulation which could be used in a test of the Solow-Hartwick weak sustainability criterion or used in a more comprehensive assessment of the effects of mining on development. |
| Keywords: | Environmental Economics and Policy, International Development |
| URL: | https://d.repec.org/n?u=RePEc:ags:uyoarc:263918 |
| By: | Bell, Peter |
| Abstract: | The historic strategy of global resource imperialism, implemented by the 2013 Belt and Road Initiative from the People's Republic of China, has set a new competitive landscape for economic development worldwide, and the China-Pakistan Economic Corridor is a priority case study for the impacts of rapidly modernizing local transportation networks, energy infrastructure, and the economy. It is essential to track local attitudes towards these government programs, as in the research by Saif, Meixia, and Saleem (2023) from Dalian Jiaotong University, which provides survey results from construction industry participants in Pakistan during this ongoing massive infrastructure investment program. |
| Keywords: | Surveys, Belt and Road Initiative, CPEC (China-Pakistan Economic Corridor), Construction industry, Transnational operation management, Sustainability, Environmental impact, Economic impact, Investment, Technology transfer, Infrastructure development, Stakeholder engagement, Governance, Capacity building, Innovation |
| JEL: | C0 D2 E0 E02 E6 E65 F2 F21 F4 F6 G0 H0 H5 H54 J08 J4 K33 L5 L7 L74 L78 M5 O2 P0 Q0 Q33 R0 R58 |
| Date: | 2025–11–17 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:126852 |
| By: | Luc Jacolin; Florian Léon; Edouard Mien; Paul Vertier |
| Abstract: | Granular mine data show that the supply of minerals critical to the energy transition reacts rapidly to price movements caused by demand shocks. The reaction depends on the characteristics of mines and of global mineral markets. It is weaker in Africa due to the higher prevalence of conflicts near mines, which makes it harder for supply to adjust. <p> Des données minières granulaires permettent de montrer que l’offre de minerais critiques à la transition énergétique réagit rapidement aux variations de prix induites par un choc de demande. Cette réaction dépend des caractéristiques des mines et du marché mondial. Elle est plus faible sur le continent africain, en raison de conflits plus nombreux à proximité des mines, limitant la capacité de réaction de l’offre. |
| Date: | 2025–11–20 |
| URL: | https://d.repec.org/n?u=RePEc:bfr:econot:419 |
| By: | Stern, David I. |
| Abstract: | There has been much debate about the contribution of the mining sector to economic development in developing countries, though multi-country empirical studies have been very limited. Vector-autoregression models are used to determine the contribution of the mining sector to economic development in nineteen developing countries. Impulse response functions estimate the multiplier of mining output on non-mining GDP, net foreign factor payments, imports, manufactured capital, and human capital. The results indicate that in the majority of countries, the mining sector contributes little or nothing to GNP and factor accumulation. In a few countries, however, mining does contribute to economic development. |
| Keywords: | Environmental Economics and Policy |
| URL: | https://d.repec.org/n?u=RePEc:ags:uyoarc:263919 |
| By: | Wang, Yitian (Department of Economics, Monash University, Clayton, Australia); Vespignani, Joaquin (Tasmanian School of Business & Economics, University of Tasmania); Smyth, Russell (Department of Economics, Monash University, Clayton, Australia) |
| Abstract: | Accelerating transport electrification is vital for net-zero goals, yet remains hindered by slow, uncertain development of battery minerals. We show how non-technical risk, such as policy, regulatory, social, and geopolitical risk, inflate capital costs, delay greenfield supply, and heighten price volatility for lithium, cobalt, nickel, manganese, graphite, and copper. Combining Fraser Institute investment scores with reserve shares of these critical minerals, we construct dynamic, mineral-specific risk premiums, derive an optimal stockpiling rule balancing risk and storage costs and introduce a distance-to-iso-cost map comparing recycling and stockpiling strategies. Our framework suggests that in 2040 recycling-led stabilization will be the optimal strategy for mitigating non-technical risk for Japan and Korea, strategic stockpiling will be the optimal strategy for China and the United States, and mixed outcomes for Europe. The method that we propose provides a tractable and updateable toolkit for deciding optimal stockpiles and prioritising recycling where it is most cost-effective. |
| Keywords: | economics; finance; energy economics |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:tas:wpaper:60464201 |
| By: | Fekria Belhouichet; Guglielmo Maria Caporale; Luis Alberiko Gil-Alana |
| Abstract: | This study examines the contemporaneous and lagged connectedness between the daily returns of AI and robotics-related assets, a global stock market index, commodity prices (gold and Brent crude oil), cryptocurrencies, and a carbon index over the period from 3 January 2023 to 30 September 2025, against a backdrop of persistent geopolitical tensions, using the innovative R² connectedness method developed by Balli et al. (2023). The results reveal that contemporaneous effects predominate over lagged ones. Furthermore, AI and robotics-related assets behave primarily as net emitters of shocks, as does the MSCI World Index, which exerts positive contagion effects and plays a central role in risk transmission. By constrast, gold and Brent crude oil act as net receivers of shocks, which in the case of the former reflects its role as a safe-haven asset. Cryptocurrencies instead exhibit heterogeneous dynamics : Cardano (ADA) acts as a net transmitter of shocks, while Bitcoin (BTC) and Stellar (XLM) behave more as receivers, contributing to market stability. Finally, the CO₂ index displays net negative connectedness, which confirm its role as a receiver of shocks. These findings provide useful information to investors and portfolio managers for risk diversification purposes and to policy-makers for ensuring financial stabilily, especially during periods of market turbulence. |
| Keywords: | assets returns, CO2 emissions, contemporaneous and lagged R2 connectedness |
| JEL: | C32 G11 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12333 |
| By: | Ayoki, Milton |
| Abstract: | Since 2003, the West African Economic and Monetary Union (WAEMU) and Central African Economic and Monetary Community (CEMAC) have implemented binding directives to harmonize mining tax regimes and eliminate fiscal competition. Yet, we observe a proliferation of mine-specific stability clauses—contractual provisions that freeze tax rates for 20-30 years—in response to these coordination efforts. Analyzing 47 mining contracts across 12 WAEMU and CEMAC countries (2010-2023), this paper identifies a Stability Clause Paradox: instruments designed to provide tax certainty have become the primary vehicle for undermining regional tax coordination. Our results show that mines with stability clauses face effective tax rates that are 18-23 percentage points lower than statutory rates, creating a dual fiscal regime that coordination cannot reach. Our theoretical model demonstrates that stability clauses act as commitment devices in tax competition, locking in race-to-the-bottom dynamics for decades. The paper provides the first empirical evidence that regional tax coordination in Africa is systematically circumvented through contractual tax stabilization, with immediate implications for WAEMU's ongoing mining code reforms and CEMAC investment policy reviews. |
| Keywords: | Tax competition, regional integration, stability clauses, WAEMU, CEMAC, extractive sector, tax coordination, mining contracts |
| JEL: | H25 H77 O13 O17 Q38 |
| Date: | 2025–12–01 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:127203 |
| By: | Shivani, .; Das Banerjee, Anannya; Ramji, Aditya |
| Keywords: | Engineering, Social and Behavioral Sciences |
| Date: | 2025–12–01 |
| URL: | https://d.repec.org/n?u=RePEc:cdl:itsdav:qt3db4b4cv |
| By: | Ahmadian- Yazdi, Farzaneh; Roudari, Soheil; Mensi, Walid |
| Abstract: | This paper examines the spillover effects between Sukuk and key alternative assets- conventional stock, gold, and currency- in Iran from July 2013 to December 2024. Using three advanced models-Quantile-on-Quantile (Gabauer & Stenfors, 2024), the contemporaneous and lagged R2 decomposed connectedness (Balli et al., 2023), and a portfolio approach (Broadstock et al., 2022)-the study finds that Iran's Sukuk market lacks depth for hedging against gold, currency, and stock risks across direct and reverse quantiles and under various shocks. Results show that the USD is the main contemporaneous driver, while Sukuk is a net receiver in average and contemporaneous connections. Sukuk also offers low long-term returns, making it less competitive. Gold proves optimal for long-term investment, mainly when currency acts short-term. Currency is the primary source of short-term volatility, but Sukuk fails as a stabilizing tool. Thus, including Sukuk in portfolios does not enhance diversification for risk-averse investors during crises due to its limited hedging ability in Iran. |
| Keywords: | Sukuk, Stock market, Gold, Currency, Risk spillover, Portfolio management |
| JEL: | C58 G32 |
| Date: | 2025–03–17 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:126962 |
| By: | Bell, Peter |
| Abstract: | Channabasavaiah and Naidu (2021) provide a useful summary of economic statistics on mining in India, based on several public sources at the national and state levels. They show how to aggregate information across sources to give a more accurate picture. This article presents additional calculations using their survey data in new ways. I present methods to estimate the labour share of income associated with mining and further discuss multiplier effects on GDP from mine workers' labour income. It is essential to coordinate data collection and disclosure across different levels of government to improve financial statistics and provide the best possible information to global audiences, especially as new funding models for infrastructure and mining projects emerge. |
| Keywords: | Manganese and Iron ore production, Employment, and revenue generated by the mining sector, India, GDP Methodology, Labour Share, Labour Productivity, Resource Booms, Economic Development |
| JEL: | D19 D3 D33 J4 J8 J81 L7 L72 N5 N50 O1 Q32 Q33 Q59 R1 R52 Y1 Y3 |
| Date: | 2025–11–17 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:126864 |
| By: | Jamel Saadaoui; Russell Smyth; Joaquin Vespignani; Yitian Wang |
| Abstract: | Geopolitical tensions between the United States and China pose significant risks to global critical-mineral supply chains, particularly because refining capacity for most critical minerals, including aluminium, copper, nickel, tin and zinc, is overwhelmingly concentrated in China. Using monthly data from 1995-2025 and a structural VAR-local projection framework, we estimate the dynamic effects of exogenous shocks to the US-China Political Relations Index (PRI) on mineral markets. We find that geopolitical deterioration systematically induces significant precautionary stockpiling. We then construct a multidimensional friend-shoring index incorporating reserves, alignment, regime type and distance, showing that only a narrow set of United States partners, primarily Australia and Canada, offer feasible pathways for refining diversification. The policy recommendation stemming from our findings is that the United States should make strategic stockpiling of refined critical minerals, rather than raw ores, the centerpiece of its strategy to build supply chain resilience, while negotiating long-term bilateral packages for the supply of refined critical minerals with Australia and Canada. |
| Keywords: | geopolitical risk, critical minerals, friend-shoring |
| JEL: | Q34 Q37 F51 |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:een:camaaa:2025-72 |
| By: | Luis Méndez Lobos; Esteban Ramon Perez Caldentey |
| Abstract: | Since the Global Financial Crisis developing economies, including those of Latin America, increased their reliance on foreign currency borrowing, making greater use of the international bond market. The non-financial corporate sector became the second most important issuer of debt. Using a data base comprising approximately 295 listed firms for the larger Latin American economies for the period 2013-2023, the paper shows that bond issuing firms account for a larger share of total assets, revenue and investment expenditure relative to non-bond issuing firms. These findings are reproduced for nine sectors of economic activity (agriculture, construction, information, manufacturing, mining, retail trade, transportation, utilities, wholesale trade). In addition, bond issuing firms exhibit higher and increasing levels of profitability in most sectors. This favourable context for bond issuing firms and the decoupling in profitability has not led to increased investment expenditure. This is explained by overleveraging and prioritizing financial over investment in productive activities. |
| Keywords: | international bond market, bond/non-bond issuing firms, solvency, Minsky, non-linear threshold model. |
| JEL: | E32 G15 O10 |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:pke:wpaper:pkwp2525 |
| By: | Saadaoui, Jamel (University Paris 8, IEE, LED, Saint-Denis, Franc); Smyth, Russell (Department of Economics, Monash University, Clayton, Australia); Vespignani, Joaquin (Tasmanian School of Business & Economics, University of Tasmania); Wang, Yitian (Department of Economics, Monash University, Clayton, Australia) |
| Abstract: | Geopolitical tensions between the United States and China pose significant risks to global critical-mineral supply chains, particularly because refining capacity for most critical minerals, including aluminium, copper, nickel, tin and zinc, is overwhelmingly concentrated in China. Using monthly data from 1995–2025 and a structural VAR-local projection framework, we estimate the dynamic effects of exogenous shocks to the US-China Political Relations Index (PRI) on mineral markets. We find that geopolitical deterioration systematically induces significant precautionary stockpiling. We then construct a multidimensional friend-shoring index incorporating reserves, alignment, regime type and distance, showing that only a narrow set of United States partners, primarily Australia and Canada, offer feasible pathways for refining diversification. The policy recommendation stemming from our findings is that the United States should make strategic stockpiling of refined critical minerals, rather than raw ores, the centerpiece of its strategy to build supply chain resilience, while negotiating long-term bilateral packages for the supply of refined critical minerals with Australia and Canada. |
| Keywords: | Geopolitics; Critical Minerals; Macroeconomics; economics; geopolitical risk; friend-shoring; |
| JEL: | Q34 Q37 F51 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:tas:wpaper:60464228 |
| By: | Shivani, .; Khan, Sarah; Ramji, Aditya; Das Banerjee, Anannya |
| Keywords: | Engineering, Social and Behavioral Sciences |
| Date: | 2025–12–01 |
| URL: | https://d.repec.org/n?u=RePEc:cdl:itsdav:qt3qs6r50g |
| By: | Christian von Haldenwang; Gibson Chigumira; Erinah Chipumho; Chifundo Mchowa |
| Abstract: | This explorative study analyses how the use of tax expenditures affects the fiscal contract in Zimbabwe by focusing on special economic zones (SEZs) in the mining sector. SEZs combine a variety of business-related tax expenditures. Governments use them to attract investment, boost exports, promote employment and create positive spillover effects for the national economy. However, their efficiency is often in doubt. SEZs are frequently seen as a product of lobbying by powerful economic groups, and a source of rent-seeking and corruption. |
| Keywords: | Fiscal contractualism, Taxation, Tax expenditures, Special Economic Zones, Zimbabwe |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:unu:wpaper:wp-2025-108 |
| By: | Jaeho Kim (Sogang University); Scott C. Linn (University of Oklahoma); Sora Chon (Inha University) |
| Abstract: | We show that conclusions drawn from widely used measures of price discovery are highly sensitive to the presence of price outliers in the calculations. We demonstrate using simulation studies however that the long-run information share (LFS) measure of price discovery location proposed by Kim and Linn (2022), coupled with Bayesian estimation of a Vector Error Correction Model (VECM) allowing for outliers, provides the most robust and reliable metric for evaluating price discovery in the presence of outliers. A separate empirical analysis of the spot and futures prices of non-ferrous metals shows the pervasive presence of price outliers. Implementation of our proposed estimation of a VECM using Bayesian methods allowing for outliers and the subsequent calculation of LFS, provides strong evidence that both spot and futures markets for non-ferrous metals contribute significantly to the price discovery process when daily price data are employed. |
| Keywords: | Price discovery; Cointegration; Outliers; Robust estimation; Heavytailed distributions. |
| JEL: | C11 C32 C58 G14 |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:inh:wpaper:2025-1 |