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The Rare-Earth Footprint of the Global Economy: Input-Output Evidence

Author

Listed:
  • Laura Alfaro
  • Harald Fadinger
  • Jan Schymik
  • Gede Virananda

Abstract

Rare earth elements (REEs) are essential inputs in advanced manufacturing and green technologies, yet their role in global production networks remains difficult to quantify due to data limitations. This paper develops a methodology, following Alfaro et al. (2024), to embed REE use into a standard input-output framework by augmenting the 2017 US supply-use table. This enables the measurement of industry-level total requirements of REE. Validation using firm-level business descriptions confirms that this measure captures economically meaningful REE dependence. We further develop a country-level index of geoeconomic exposure to REE supply risks, highlighting vulnerabilities among advanced manufacturing economies.

Suggested Citation

  • Laura Alfaro & Harald Fadinger & Jan Schymik & Gede Virananda, 2026. "The Rare-Earth Footprint of the Global Economy: Input-Output Evidence," AEA Papers and Proceedings, American Economic Association, vol. 116, pages 103-108, May.
    • Handle: RePEc:aea:apandp:v:116:y:2026:p:103-108
    DOI: 10.1257/pandp.20261068
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    More about this item

    JEL classification:

    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • Q31 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Demand and Supply; Prices
    • Q37 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Issues in International Trade

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