Identification of high-risk agents and relationships in nickel, cobalt, and lithium trade based on resource-dependent networks. (December 2021)

• Record Type: Journal Article
• Authors: Liu, Haiping; Li, Huajiao; Qi, Yajie; An, Pengli; Shi, Jianglan; Liu, Yanxin
• Is Part Of: Resources policy. Volume 74(2021)
• Publication Date: 2021-12
• Subjects: Nickel, cobalt, and lithium -- Trade dependency network -- Global dependency index -- High-risk country (region); Mines and mineral resources -- Periodicals; Ressources minérales -- Périodiques; Ressources naturelles -- Gestion -- Périodiques; Environnement -- Politique gouvernementale -- Périodiques; 333.8
• DOI: 10.1016/j.resourpol.2021.102370
• Languages: English
• ISSNs: 0301-4207

Abstract

Abstract: Nickel, cobalt, and lithium are the most critical raw materials for lithium-ion batteries (LIBs). The increasing demand for these materials has triggered worries about the trade dependency on raw materials. Traditional trade dependency measures make it difficult to identify high-risk countries (regions) from a systematic perspective. This paper proposes a global dependency index to recalculate systemic risks in the trade dependency network. Unlike the traditional trade network analysis, we construct the resource-dependent network by taking the dependency relationship as the edge and the global dependency index as the weight. We use the new network to explore the characteristics of the overall pattern of global trade and the concentration of dependency. Then, considering the heterogeneity of trading agents, country (regional) dependency is analyzed at the local and global levels. The dependency relationship coordinates are constructed to identify high-risk countries (regions). The results show that the trade is highly concentrated. Developed and emerging economies tend to import in quantity. The absolute dependency and global dependency of agents are heterogeneous. The distribution characteristics of agent relationships in the trade dependency coordinates are apparent. According to the results, policymakers and market participants can tailor trade strategies to reduce risks. This accounting method provides ideas for future studies on trade dependency on other resources. Highlights: This paper aims to identify high-risk agents and relationships in nickel, cobalt, and lithium raw materials trade. We propose a global dependency index to recalculate systemic risks in the trade dependency network. Trade is highly concentrated and that developed and emerging economies tend to import. We provide a accounting method for studying the trade dependency of resources.