AYRES Robert U.
Rare and Critical Metals as By-products and the Implications for Future Supply
INSEAD Working Paper 2011/129/TOM/ISIC
A number of metals that are now important to the electronics industry (and others) will become much more important in the future if current trends in technology continue. It is generally accepted wisdom among economists that scarcity is not a problem for resources, because incipient scarcity sends a price signal that induces suppliers to increase output. Moreover, the history of resource use tends to confirm this hypothesis, in as much as resource prices have generally declined since the industrial revolution, despite enormous increases in demand. However for a certain group of by-product metals, the assumed relationship between prices and output does not hold. Options are limited. We discuss the implications.