A Study on Mineral-Resources Access's Constraints on China's Economic Growth
14 Pages Posted: 31 Jan 2010
Date Written: March 8, 2009
Abstract
This article conducts an empirical study of how access to mineral resources can constrain China’s economic growth. The authors reckon that due to the relatively low price elasticity of supply and demand in relation to mineral resources over the short run, access to mineral resources place pronounced constraints on economic growth in the short run, but only marginal constraints on economic growth in the long run. This split is the result of alternate resource substitution and technological progress. In this article, the authors have calculated the actual effects of access to mineral resources on China’s economic growth using 2001-2006 mineral resource import and export data. The results of these calculations show that, in the short run, access to mineral resources is increasingly placing constraints on China’s economic growth. The value of these constraints rose from 4.96% of GDP in 2006 to 5.74% of GDP in 2007 (estimated). Contrastingly, in the long run, the constraints that access to mineral resources place on China’s economic growth are quite limited at approximately 0.23% of GDP.
Keywords: Mineral resources,Resource constraints, Economic growth
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