Abstract: | An econometric model of the US copper and aluminium industries is simulated to evaluate the impact that higher energy prices and declining ore quality will have on copper–aluminium substitution and recycling in the USA in the next decade. The unique features of the model described here include the calculation of elasticities of substitution between copper and aluminium from the production functions of the using sectors, the use of statistical (not engineering) cost functions for both the primary and the secondary industries, and the explicit consideration of ore- quality deterioration as primary production progresses. |