The subject of this research is topical, as several developing countries are considering export restrictions on rare earth materials, to boost their local industry and improve their income. In April, the president of Chile announced that he would nationalize the country’s lithium industry. And Indonesia banned exports of nickel ore, a key battery material, in 2020. The World Trade Organization recently ruled against Indonesia’s export restrictions, after the European Union filed a claim. Indonesia has appealed to the ruling.
The grant of €400,000 was awarded within the NWO Open competition for Social Sciences and Humanities (SSH-M). The research will be conducted in cooperation with project team members Maarten Bosker (Erasmus University Rotterdam) and Paul Pelzl (NHH Norwegian School of Economics).
Summary of the project
Industrial raw materials such as copper, nickel, cobalt and rare earth elements are critical inputs in countless production processes, including renewable energy, lithium batteries, and other inputs supporting the green transition. Many developing countries simply export raw materials while most value added is generated in advanced economies, which lowers global consumer prices but does little to reduce poverty and global inequality.
Many countries therefore started to voluntarily restrict raw material exports, often to promote local processing industries. Does that put them on a path to prosperity, and what are the implications for trade, global value chains, and the energy transition?
About Steven Poelhekke
Steven Poelhekke is Professor of International Environmental Economics at the Vrije Universiteit Amsterdam, School of Business and Economics. He is research fellow at CEPR and affiliated with the Tinbergen Institute, CESifo in Munich, and OxCarre in Oxford. He has published among others in the Review of Economics and Statistics, Journal of the European Economic Association, Journal of International Economics, Journal of Development Economics, and the Journal of Economic Growth. Columns and policy pieces have appeared on VoxEU.org, the LSE Business Review and Economisch Statistische Berichten.
His research interests cover International Trade and Investment, and their intersections with Development and Environmental Economics. He has studied, among other topics: the local impact of mining on infrastructure and the tradeable sector, the persistence of foreign direct investment benefits for domestic firms in developing countries, and the effects of resource wealth and multinational banks on foreign direct investment.