Jevons Paradox: Difference between revisions

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In economics, the Jevons paradox (/ˈdʒɛvənz/; sometimes Jevons' effect) occurs when technological progress or government policy increases the efficiency with which a resource is used (reducing the amount necessary for any one use), but the rate of consumption of that resource rises due to increasing demand.[1] The Jevons paradox is perhaps the most widely known paradox in environmental economics.[2] However, governments and environmentalists generally assume that efficiency gains will lower resource consumption, ignoring the possibility of the paradox arising.[3]
[[File:Jevons paradox.jpg|alt=More efficiency = more consumption.|thumb|'''Figure 1'''. More efficiency = more consumption.]]
'''Jevons Paradox (or the Rebound effect) occurs when a more efficient way of consuming something leads to its increase in demand<ref>'''Book Review Perspectives: The Jevons Paradox and the Myth of Resource Efficiency Improvements".''' ''Sustainability: Science, Practice, & Policy''.  Bauer, Diana; Papp, Kathryn (March 18, 2009). '''5''' (1). doi:10.1080/15487733.2009.11908028.</ref>. For instance, the use of [[Electric Vehicles|electric vehicles]], has been found to increase energy consumption as they are used more. This seemingly paradoxical mechanism, runs contrary to the assumption that efficiency gains will lower resource consumption<ref>"'''Jevons' paradox"'''. Alcott, Blake (July 2005). ''Ecological Economics''. '''54''' (1): 9–21. doi:10.1016/j.ecolecon.2005.03.020. hdl:1942/22574.</ref>.'''


In 1865, the English economist William Stanley Jevons observed that technological improvements that increased the efficiency of coal-use led to the increased consumption of coal in a wide range of industries. He argued that, contrary to common intuition, technological progress could not be relied upon to reduce fuel consumption.[4][5]
In 1865, the English economist William Stanley Jevons observed that technological improvements that increased the efficiency of coal-use led to the increased consumption of coal in a wide range of industries. He argued that, contrary to common intuition, technological progress could not be relied upon to reduce fuel consumption<ref>'''''The Coal Question''''' (2nd ed.). Jevons, William Stanley (1866). "VII".  London: Macmillan and Company. OCLC 464772008. Retrieved 2008-07-21.</ref>.
[[File:Jevons paradox graph.jpg|alt=Jevons paradox graph|thumb|'''Figure 2'''. Energy efficiency has increased 36% whilst energy consumption is up 63%.]]
The issue has been re-examined by modern economists studying consumption rebound effects from improved energy efficiency<ref>'''Energy efficiency and economy-wide rebound effects: A review of the evidence and its implications'''. Paul E.Brockway, Steve Sorrell. Renewable and Sustainable Energy Reviews, Volume 141, May 2021, 110781. </ref>. In addition to reducing the amount needed for a given use, improved efficiency also lowers the relative cost of using a resource, which increases the quantity demanded. This counteracts (to some extent) the reduction in use from improved efficiency. Additionally, improved efficiency increases real incomes and accelerates economic growth, further increasing the demand for resources. The Jevons paradox occurs when the effect from increased demand predominates, and improved efficiency increases the speed at which resources are used.<ref>'''Historical Overview of the Jevons paradox in the Literature'''. In JM Polimeni; K Mayumi; M Giampietro (eds.). Alcott, Blake (2008).  ''The Jevons Paradox and the Myth of Resource Efficiency Improvements''. Earthscan. pp. 7–78. ISBN <bdi>978-1-84407-462-4</bdi>.</ref>


The issue has been re-examined by modern economists studying consumption rebound effects from improved energy efficiency. In addition to reducing the amount needed for a given use, improved efficiency also lowers the relative cost of using a resource, which increases the quantity demanded. This counteracts (to some extent) the reduction in use from improved efficiency. Additionally, improved efficiency increases real incomes and accelerates economic growth, further increasing the demand for resources. The Jevons paradox occurs when the effect from increased demand predominates, and improved efficiency increases the speed at which resources are used.[5]
'''References'''

Latest revision as of 00:32, 16 October 2023

More efficiency = more consumption.
Figure 1. More efficiency = more consumption.

Jevons Paradox (or the Rebound effect) occurs when a more efficient way of consuming something leads to its increase in demand[1]. For instance, the use of electric vehicles, has been found to increase energy consumption as they are used more. This seemingly paradoxical mechanism, runs contrary to the assumption that efficiency gains will lower resource consumption[2].

In 1865, the English economist William Stanley Jevons observed that technological improvements that increased the efficiency of coal-use led to the increased consumption of coal in a wide range of industries. He argued that, contrary to common intuition, technological progress could not be relied upon to reduce fuel consumption[3].

Jevons paradox graph
Figure 2. Energy efficiency has increased 36% whilst energy consumption is up 63%.

The issue has been re-examined by modern economists studying consumption rebound effects from improved energy efficiency[4]. In addition to reducing the amount needed for a given use, improved efficiency also lowers the relative cost of using a resource, which increases the quantity demanded. This counteracts (to some extent) the reduction in use from improved efficiency. Additionally, improved efficiency increases real incomes and accelerates economic growth, further increasing the demand for resources. The Jevons paradox occurs when the effect from increased demand predominates, and improved efficiency increases the speed at which resources are used.[5]

References

  1. Book Review Perspectives: The Jevons Paradox and the Myth of Resource Efficiency Improvements". Sustainability: Science, Practice, & Policy. Bauer, Diana; Papp, Kathryn (March 18, 2009). 5 (1). doi:10.1080/15487733.2009.11908028.
  2. "Jevons' paradox". Alcott, Blake (July 2005). Ecological Economics. 54 (1): 9–21. doi:10.1016/j.ecolecon.2005.03.020. hdl:1942/22574.
  3. The Coal Question (2nd ed.). Jevons, William Stanley (1866). "VII". London: Macmillan and Company. OCLC 464772008. Retrieved 2008-07-21.
  4. Energy efficiency and economy-wide rebound effects: A review of the evidence and its implications. Paul E.Brockway, Steve Sorrell. Renewable and Sustainable Energy Reviews, Volume 141, May 2021, 110781.
  5. Historical Overview of the Jevons paradox in the Literature. In JM Polimeni; K Mayumi; M Giampietro (eds.). Alcott, Blake (2008). The Jevons Paradox and the Myth of Resource Efficiency Improvements. Earthscan. pp. 7–78. ISBN 978-1-84407-462-4.

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