Jevons' Paradox

Extracted Attributes

• Field

  Economics / Environmental Economics

• Discoverer

  William Stanley Jevons

• Core Mechanism

  Price elasticity of demand

• Key Publication

  The Coal Question (1865)

• Primary Example

  Coal consumption in 19th-century Britain

• Alternative Name

  Rebound effect

Timeline

• William Stanley Jevons publishes 'The Coal Question,' describing the paradox regarding coal efficiency and consumption. (Source: undefined)

  1865-01-01

• British coal consumption triples despite efficiency gains, validating Jevons' initial observations. (Source: undefined)

  1900-01-01

• Recent analysis explores the paradox's relevance to the future of AI and low-cost chatbots like DeepSeek. (Source: undefined)

  2025-02-07

• The All-In Podcast hosts predict AI will increase total jobs based on the Jevons' Paradox. (Source: undefined)

  2026-01-01

Jevons paradox

In economics, the Jevons paradox (; sometimes Jevons effect) occurs when technological advancements make a resource more efficient to use (thereby reducing the amount needed for a single application); however, as the market cost of using the resource drops, if demand is highly price elastic, this results in overall demand increasing, causing total resource consumption to rise. Governments have typically expected efficiency gains to lower resource consumption, rather than anticipating possible increases due to the Jevons paradox. 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. 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 may counteract (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 the improved efficiency results in a faster rate of resource use. Considerable debate exists about the size of the rebound in energy efficiency and the relevance of the Jevons paradox to energy conservation. Some dismiss the effect, while others worry that it may be self-defeating to pursue sustainability by increasing energy efficiency. Some environmental economists have proposed that efficiency gains be coupled with conservation policies that keep the cost of use the same (or higher) to avoid the Jevons paradox. Conservation policies that increase cost of use (such as cap and trade or green taxes) can be used to control the rebound effect.

Web Search Results

• Artificial Intelligence and the Jevons Paradox - LinkedIn

  ## 2. The Jevons Paradox Jevons Paradox, also known as the rebound effect, was created by the young English Economist William Stanley Jevons, is an economic principle that suggests that increases in efficiency can lead to an increase in consumption, thereby offsetting the gains made by the efficiency improvements. In the context of AI, Jevons Paradox implies that as AI systems become more efficient at performing tasks, they may actually increase the demand for those tasks, leading to increased consumption of resources. [...] in work and schools. Here we start to introduce the Jevons Paradox, a statement of economics that shows how efficiency has a negative and positive aspect on the economy and on the planet.

• What Are Real World Examples of Jevons Paradox? → Question

  ## Academic From an academic perspective, the Jevons Paradox, or more broadly, the rebound effect, is a critical concept in environmental economics and ecological economics. It challenges the neoclassical economic assumption that technological efficiency improvements automatically lead to proportionate reductions in resource consumption. The core debate centers on the magnitude of the rebound effect → whether it is partial (less than 100% of the efficiency gain is offset by increased consumption), full (100% offset, total consumption remains constant), or backfire (more than 100% offset, total consumption increases). [...] ## Fundamentals The Jevons Paradox, often discussed in the context of environmental challenges, describes a counter-intuitive phenomenon: as technological advancement increases the efficiency with which a resource is used, the rate of consumption of that resource rises. This occurs because increased efficiency lowers the cost of using the resource, leading to greater demand and subsequent overall usage. William Stanley Jevons first observed this in the 19th century concerning coal. He noted that while the invention of more efficient steam engines reduced the amount of coal needed per unit of output, total coal consumption in England skyrocketed because steam power became cheaper and more widely adopted across industries. [...] Ultimately, the Jevons Paradox serves as a potent reminder in sustainability discourse that technological fixes are insufficient on their own. Addressing pollution and environmental degradation requires a systemic approach that considers economic incentives, behavioral responses, social equity, and the complex interplay between efficiency, consumption, and economic structure across diverse cultural and geographical contexts.

• Jevons paradox - Wikipedia

  The Jevons paradox was first described by the English economist William Stanley Jevons in his 1865 book The Coal Question. Jevons observed that England's consumption of coal soared after James Watt introduced the Watt steam engine, which greatly improved the efficiency of the coal-fired steam engine from Thomas Newcomen's earlier design. Watt's innovations made coal a more cost-effective power source, leading to the increased use of the steam engine in a wide range of industries. This in turn increased total coal consumption, even as the amount of coal required for any particular application fell. Jevons argued that improvements in fuel efficiency tend to increase (rather than decrease) fuel use, writing: "It is a confusion of ideas to suppose that the economical use of fuel is equivalent [...] The Jevons paradox is sometimes used to argue that energy conservation efforts are futile, for example, that more efficient use of oil will lead to increased demand, and will not slow the arrival or the effects of peak oil. This argument is usually presented as a reason not to enact environmental policies or pursue fuel efficiency (e.g., if cars are more efficient, it will simply lead to more driving). Several points have been raised against this argument. First, in the context of a mature market such as for oil in developed countries, the direct rebound effect is usually small, and so increased fuel efficiency usually reduces resource use, other conditions remaining constant. Second, even if increased efficiency does not reduce the total amount of fuel used, there remain other benefits [...] Efficiency leads to increased demand In economics, the Jevons paradox (/ˈdʒɛvənz/; sometimes Jevons effect) occurs when technological advancements make a resource "Resource (economics)") more efficient to use (thereby reducing the amount needed for a single application); however, as the market cost of using the resource drops, if demand is highly price elastic, this results in overall demand increasing, causing total resource consumption to rise. Governments have typically expected efficiency gains to lower resource consumption, rather than anticipating possible increases due to the Jevons paradox.

• The Jevons Paradox: When Efficiency Leads to Increased ...

  ## Understanding the Jevons Paradox The Jevons Paradox is named after the English economist William Stanley Jevons, who first observed this phenomenon in the mid-19th century. Jevons noticed that improved steam engine efficiency resulted in higher coal consumption rather than conservation. He argued that as the efficiency of steam engines increased, their usage expanded, offsetting any gains made in energy conservation. ## The concept of rebound effects can explain the underlying mechanism of the Jevons Paradox. When the cost of using a resource decreases due to increased efficiency, it becomes more attractive for consumers and industries to utilise it. Consequently, this increased affordability leads to higher consumption and can potentially offset the initial gains in efficiency. [...] ## Implications and Solutions The Jevons Paradox has significant implications for policymakers, businesses, and individuals concerned about resource conservation and sustainability. It suggests that relying solely on improving efficiency may not be sufficient to achieve the desired environmental outcomes. While efficiency gains can undoubtedly contribute to reducing our impact, they must be complemented by measures that address the rebound effects). Awareness and Education: Raising awareness about the Jevons Paradox is crucial. By understanding the potential pitfalls of efficiency gains, individuals and organisations can make informed decisions and avoid falling into the consumption trap. Education can help promote more conscious consumption habits and encourage long-term thinking. [...] Systemic Changes: To address the Jevons Paradox effectively, we must examine the underlying systems that drive consumption. Transitioning towards circular economies, promoting sharing and collaborative consumption models, and encouraging the development of sustainable technologies can help break the cycle of increased consumption resulting from efficiency gains. ## The Jevons Paradox serves as a reminder that the relationship between efficiency and consumption is complex. While efficiency improvements are crucial in reducing our ecological footprint, they may not achieve the desired conservation outcomes. The phenomenon highlights the need for a holistic approach considering both efficiency gains and the behavioural and systemic factors influencing consumption patterns.

• What is Jevons Paradox? And why it may - Northeastern Global News

  ## What is Jevons Paradox? British economist William Stanley Jevons first presented his eponymous paradox in his 1865 book, “The Coal Question,” where he noted that more efficient steam engines had not led to a decrease in the use of coal in British factories as many believed, but increased the use as the fossil fuel became cheaper and more engines and factories were built. “Efficiency can backfire by making a resource so cheap that everyone uses it more,” Piao summarizes, noting that British coal consumption tripled by 1900. [...] Headshot of Cyrus Moulton A black and white historical drawing of smoke rising out of chimneys and smoke stacks on buildings in St. Louis Missouri along the river. In 1865, William Stanley Jevons first described a paradox. He maintained that more efficient steam engines would not decrease the use of coal in British factories but would actually increase it. As the fossil fuel became cheaper, demand for the resource would grow, leading to the construction of more engines. So, what does coal consumption in the 19th century have to do with today? The technology sector hopes the answer is a lot, as entrepreneurs resurrect the paradox to buoy their projections for AI growth amid the emergence of a low-cost chatbot by Chinese startup DeepSeek.