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The impact of geopolitical risk on strategic emerging minerals prices: Evidence from MODWT-based Granger causality test

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  • Shao, Liuguo
  • Cao, Saisha
  • Zhang, Hua

Abstract

Strategic emerging minerals have significant relevance in various industries such as information technology, new energy, environmental protection, and aerospace. As global geopolitical disputes and trade frictions intensify, the relationship between geopolitical risk (GPR) and strategic emerging minerals has attracted extensive attention from scholars. This paper combines the maximal overlap discrete wavelet transform (MOWDT) model and Granger causality test to explore the relationship from both time and frequency domain perspectives. For time domain perspective, we find that linear and nonlinear Granger causality doesn't exist between GPR and strategic emerging minerals. From frequency domain perspective, there is always a single Granger causality from GPR to minerals, which indicates that GPR has a great impact on the strategic emerging minerals, especially in the medium- and long-term. Overall, our findings are valuable for policy makers, portfolio managers, and investors to gain a deeper understanding of the correlation between GPR and strategic emerging minerals, enabling them to make more informed decisions.

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  • Shao, Liuguo & Cao, Saisha & Zhang, Hua, 2024. "The impact of geopolitical risk on strategic emerging minerals prices: Evidence from MODWT-based Granger causality test," Resources Policy, Elsevier, vol. 88(C).
    • Handle: RePEc:eee:jrpoli:v:88:y:2024:i:c:s0301420723010991
    DOI: 10.1016/j.resourpol.2023.104388
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