The climate crisis will not be overcome without technology. But, could perhaps innovation and efficiency be worse for the environment, not better? Jaume Freire-Gonzalez argues that we need to consider the Jevons paradox when considering the environment. Or else our innovations can undermine the very problem they seek to solve. Originally published at the OECD forum https://www.oecd-forum.org/posts/the-jevons-paradox-and-rebound-effect-are-we-implementing-the-right-energy-and-climate-change-policies.

In the 19^th century, a renowned economist called William Stanley Jevons noted in a seminal book, The Coal Question (1865), that efficiency improvements in the use of coal in Scotland between 1830 and 1863 led to an increase in its demand, not a decrease as conventional wisdom would dictate. In his own words: “The reduction of the consumption of coal, per ton of iron, to less than one-third of its former amount, has been followed, in Scotland, by a ten-fold total consumption, not to speak of the indirect effect of cheap iron in accelerating other coal-consuming branches of industry”. Jevons was defining an extreme case of what we now know as the “rebound effect”: the unexpected effects of improvements to resource efficiency, productivity or conservation—not predicted by engineering analyses—on the use of these resources due to socioeconomic and behavioural responses.