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How Effective is Lithium Recycling as a Remedy for Resource Scarcity?

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  • Knut Einar Rosendahl

    (Norwegian University of Life Sciences)

  • Diana Roa Rubiano

    (Norwegian University of Life Sciences)

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. Without a market for lithium waste, we show that the efficient outcome can alternatively be realized through a proper set of subsidies to either buyers or sellers of both virgin and recycled lithium. We find that optimal subsidies may become quite substantial in the second half of this century. The size of these subsidies depends, however, on several uncertain assumptions such as technological progress in recycling, quality-grade of recovered lithium, and demand elasticity.

Suggested Citation

  • Knut Einar Rosendahl & Diana Roa Rubiano, 2019. "How Effective is Lithium Recycling as a Remedy for Resource Scarcity?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 74(3), pages 985-1010, November.
    • Handle: RePEc:kap:enreec:v:74:y:2019:i:3:d:10.1007_s10640-019-00356-5
    DOI: 10.1007/s10640-019-00356-5
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    Cited by:

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    3. Compagnoni, Marco & Grazzi, Marco & Pieri, Fabio & Tomasi, Chiara, 2023. "Extended producer responsibility and trade flows in waste: The case of batteries," FEEM Working Papers 338789, Fondazione Eni Enrico Mattei (FEEM).
    4. Bruno Jetin, 2020. "Who will control the electric vehicle market?," International Journal of Automotive Technology and Management, Inderscience Enterprises Ltd, vol. 20(2), pages 156-177.
    5. Terreaux, Jean-Philippe, 2022. "The rise and fall of La Graufesenque: The fate of development based on a non-renewable resource," Ecological Economics, Elsevier, vol. 196(C).
    6. Diana Roa & Knut Einar Rosendahl, 2023. "Policies for Material Circularity: the Case of Lithium," Circular Economy and Sustainability,, Springer.

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    More about this item

    Keywords

    Natural resource economics; Exhaustible resources; Minerals; Recycling;
    All these keywords.

    JEL classification:

    • L72 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Mining, Extraction, and Refining: Other Nonrenewable Resources
    • Q30 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - General
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling

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