What is Jevon’s Paradox?

by Ananya Iyer

Over the years, technological innovations have made the use of resources more efficient. In the late 1700s, James Watt introduced the Watt steam engine, which used coal more efficiently than the earlier models, subsequently making coal more cost effective [1]. However, this did not cut down the consumption of coal, but in fact drastically increased it in many industries. William Stanley Jevons noted this paradox in his 1865 book The Coal Question, and went on to state that “increases in resource use efficiency will lead to faster depletion of that resource” [2]. Although Jevon spoke about coal with this paradox, it has been applied to a wide range of industries from how the invention of the cotton gin increased slavery in the USA to how agricultural intensification leads to increased land conversion and more [3,4]. 

In the context of climate change, the word ‘efficiency’ is everywhere – particularly with regard to being energy efficient. Energy efficiency has been called ‘the fifth fuel’ and is widely considered as a free tool that can assist in the transition to a green economy [5]. In 1992, Harry Saunders built on Jevon’s paradox and said “energy efficiency gains will increase consumption above where it would be without these gains” [6]. At times, Jevon’s paradox is used to prevent the implementation of policies, arguing that efforts to use energy more efficiently will not achieve the desired goal. Kimberley A. Strassel argues against demand management and for ‘the rebound effect’, stating that the Bush administration that followed Bill Clinton’s policy of allowing producers to keep producing energy is the right way. [7] Improving the efficiency of energy use is still important – it can help mitigate changes in price and shortages of a resource if the use of that resource is efficient. 

Many economists today argue that energy efficiency alone is not enough to reduce the overall consumption of energy, but this needs to be employed in conjunction with policies that limit the use of energy as well. This coupling is vital in reducing the emissions associated with energy use and in the transition to clean energy to mitigate the effects of climate change in the long run. 

References:

[1] Spear, B. (2008). James Watt: The steam engine and the commercialization of patents. World patent information, 30(1), 53-58. URL: https://www.sciencedirect.com/journal/world-patent-information/vol/30/issue/1, accessed on 2 June 2021.
[2] Jevons, W. S. 1865. The coal question., Macmillan & Co. London, ISBN: 978-0-678-00107-3.
[3] Curren, E. (2013). The paradox of the cotton gin and labor-saving technology — Transition Voice. https://transitionvoice.com/2013/04/the-cotton-gin-paradox/, accessed on 2 June 2021.
[4] Pellegrini, P., & Fernández, R. J. (2018). Crop intensification, land use, and on-farm energy-use efficiency during the worldwide spread of the green revolution. Proceedings of the National Academy of Sciences, 115(10), 2335-2340. DOI: https://doi.org/10.1073/pnas.1717072115, accessed on 2 June 2021.
[5] Bhaskar, A. (2017). Efficiency: The Fifth Fuel Economy. URL: https://www.climateinvestmentfunds.org/news/efficiency-fifth-fuel-economy, accessed on 3 June 2021.
[6] Saunders, H. D. (1992). The Khazzoom-Brookes Postulate and Neoclassical Growth. The Energy Journal, 13(4), 131-148. URL: http://www.jstor.org/stable/41322471, accessed on 3 June 2021.[7] Strassel, Kimberley A. (2001). Conservation Wastes Energy. The Wall Street Journal. URL: https://www.wsj.com/articles/SB990053498329485043, accessed on 2 June 2021.