A model of the aluminum industry in the United States

Abstract

The energy crisis, the high capital requirements and the high price of the raw materials are critically affecting the short and long run decisions of the aluminum industry in the United States. To study the effect of these and other factors in the optimal development of the industry, a time dynamic linear model was developed. The model represents the industry in the United States interacting with the raw materials supplying countries.

To demonstrate the capability of the model, nine case studies were run representing nine probable scenarios. The results, which should be approached from both a qualitative and a quantitative point of view, are discussed and some limited conclusions are derived.