The security of critical mineral supply chains has become more vital than ever with the rapid development of electric vehicles and energy storage battery industries. Economic uncertainty, among the various influencing factors, reshapes critical mineral supply chains in multiple ways. However, how economic uncertainty affects the security of critical mineral supply chains remains underexplored. This chapter addresses this research gap by analyzing the effects of economic uncertainty on supply chain resilience, using China—a major economy and large importer of critical minerals—as a case study. This chapter constructs a supply chain resilience index using the entropy method based on the data of Chinese listed companies in the critical minerals sector from 2011 to 2022. The estimation results reveal that critical mineral companies enhance their supply chain resilience in response to economic uncertainty. Robustness checks, including using alternative variable measurements, instrumental variable, and adjusted regression years, confirm this finding. Heterogeneity analysis indicates that the impact of economic uncertainty varies across different types of critical mineral firms. Additionally, cash flow and innovation capabilities emerge as positive mediators in strengthening resilience. These insights provide policy implications for critical mineral firms aiming to enhance supply chain security in uncertain economic environments.

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Impacts of Economic Uncertainty on the Supply Chain Security of Critical Minerals: Evidence from China

  • Xuemei Zheng,
  • Aoxin Fan,
  • Phoumin Han

摘要

The security of critical mineral supply chains has become more vital than ever with the rapid development of electric vehicles and energy storage battery industries. Economic uncertainty, among the various influencing factors, reshapes critical mineral supply chains in multiple ways. However, how economic uncertainty affects the security of critical mineral supply chains remains underexplored. This chapter addresses this research gap by analyzing the effects of economic uncertainty on supply chain resilience, using China—a major economy and large importer of critical minerals—as a case study. This chapter constructs a supply chain resilience index using the entropy method based on the data of Chinese listed companies in the critical minerals sector from 2011 to 2022. The estimation results reveal that critical mineral companies enhance their supply chain resilience in response to economic uncertainty. Robustness checks, including using alternative variable measurements, instrumental variable, and adjusted regression years, confirm this finding. Heterogeneity analysis indicates that the impact of economic uncertainty varies across different types of critical mineral firms. Additionally, cash flow and innovation capabilities emerge as positive mediators in strengthening resilience. These insights provide policy implications for critical mineral firms aiming to enhance supply chain security in uncertain economic environments.