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Cyber, Geopolitical, and Financial Risks in Rare Earth Markets: Drivers of Market Volatility

Author

Listed:
  • Emilia Calefariu Giol

    (Department of Engineering and Industrial Management, Transilvania University of Brasov, Eroilor Street 29, 500036 Brasov, Romania)

  • Oana Panazan

    (Department of Engineering and Industrial Management, Transilvania University of Brasov, Eroilor Street 29, 500036 Brasov, Romania)

  • Catalin Gheorghe

    (Department of Engineering and Industrial Management, Transilvania University of Brasov, Eroilor Street 29, 500036 Brasov, Romania)

Abstract

This study examines the integrated impacts of cyberattacks, geopolitical, and financial market volatility on rare earth markets during the 2014–2024 period, using Time-Varying Parameter Vector Autoregression and wavelet analysis. By bridging critical gaps in the literature, this research provides a comprehensive framework for understanding the compounded effects of emerging risks on market dynamics. The analysis includes key market indices (SOLLIT, PICK, SPGSIN, GSPTXGM, MVREMXTR, and XME), alongside green energy prices, to capture cross-market dependencies. The findings reveal that financial volatility exerts the most persistent long-term influence, while geopolitical events, such as the US-China trade tensions and the Ukraine conflict, trigger significant market disruptions. Cyberattacks, although episodic, exacerbate short-term volatility, especially during global crises. Rising green energy prices further amplify vulnerabilities in supply chains, underscoring the interconnectedness of rare earth markets and the sustainable energy transition. This research provides actionable insights for integrated risk management strategies, emphasizing supply chain diversification, enhanced cybersecurity, and international cooperation to ensure market stability and resilience in the energy transition.

Suggested Citation

  • Emilia Calefariu Giol & Oana Panazan & Catalin Gheorghe, 2025. "Cyber, Geopolitical, and Financial Risks in Rare Earth Markets: Drivers of Market Volatility," Risks, MDPI, vol. 13(3), pages 1-27, February.
    • Handle: RePEc:gam:jrisks:v:13:y:2025:i:3:p:46-:d:1602288
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    References listed on IDEAS

    as
    1. Park, Sulgiye & Tracy, Cameron L. & Ewing, Rodney C., 2023. "Reimagining US rare earth production: Domestic failures and the decline of US rare earth production dominance – Lessons learned and recommendations," Resources Policy, Elsevier, vol. 85(PA).
    2. Fan, John Hua & Omura, Akihiro & Roca, Eduardo, 2023. "Geopolitics and rare earth metals," European Journal of Political Economy, Elsevier, vol. 78(C).
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