The potential impact of short-run disruptions in the minerals market on Israel's small, developed open economy is examined, showing that Israel is potentially capable of a smoother adjustment to external market disturbances. First, the analysis evaluates critical situations within the framework of a normative 'general equilibrium model', tracing the impacts of short-run developments in the resources market, and, second, it focuses on specific minerals within a partial equilibrium framework, using economic supply - demand relationships to assess economic damages. The potential damage estimates indicate that significant research and development outlays in the areas of material and process substitution and the capability for a quick build-up of contingent inventories would be justified to prevent the damages which supply disruption might inflict on the economy.
Bibliographical noteFunding Information:
This paper is part of an extensive research project funded by the S. Neaman Institute for Advanced Studies in Science and Technology and the National Council for Research and Development, with Professor I. Lin and the first author as principal investigators. The authors wish to acknowledge the research assistance of Ft. Maayan and A. Breiner.
- Supply disruptions
ASJC Scopus subject areas
- Sociology and Political Science
- Economics and Econometrics
- Management, Monitoring, Policy and Law