In the News

The Race for Clean Energy - A Case of Derived Demand and Inelastic Supply

Graham Watson

27th September 2022

This FT clip looks at the prospects for net zero carbon, initially by highlighting the need to adopt renewable energy and electric cars.

However, rather than worrying about this itself, this clip looks at the derived demand for green tech resources source as polysilicon and rare earth metals. As a result of higher levels of demand and, in manty cases, price inelastic supply, their prices have risen and as we all know Economics is all about incentives.

However, China has already established a number of production facilities across the globe and many think that the fact that the West is lagging behind is going to cause supply chain issues going forward.

Graham Watson

Graham Watson has taught Economics for over twenty years. He contributes to tutor2u, reads voraciously and is interested in all aspects of Teaching and Learning.

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