Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/46735 
Authors: 
Year of Publication: 
1981
Citation: 
[Publisher:] Institut für Weltwirtschaft (IfW) [Place:] Kiel [Year:] 1981
Series/Report no.: 
Kiel Working Paper No. 129
Publisher: 
Kiel Institute of World Economics (IfW), Kiel
Abstract: 
This study presents an econometric model of the world cobalt industry, relatively disaggregated to incorporate different demand equations for the United States, and rest of the non-communist world, as well as a breakdown into types of cobalt used. Largely due to reasons of data availability, the model is an annual one and the breakdown by end use categories has been restricted to the United States. Particular attention in the model construction has been given to price setting in the cobalt market. Existing evidence by Burrows (1971) and Charles River Associates (1976) suggests that Zaire sets the price so as to maximise its own profits. The aim of this study is to estimate aggregate and disaggregate short run and long run elasticities with respect to price and activity variables, and to test whether the own profit maximization hypotheses is representative of current producer price setting behaviour when Zaire's share in total world mine production has fallen from nearly two thirds to less than half between 1972 and 1978. Finally, the model constructed is used to simulate the effect of marginal cost pricing by major producers and the movements in price resulting from an exogeneous increase in supply. The latter exercise was motivated by the possibility of a substantial long run source of supply of cobalt from seabed mining.
Document Type: 
Working Paper
Document Version: 
Digitized Version

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.