Jevons revisited: the evidence for backfire from improved energy efficiency

Beginning with William Stanley Jevons in 1865, a number of authors have claimed that economically justified energy-efficiency improvements will increase rather than reduce energy consumption. Jevons Paradox is extremely difficult to test empirically, but could have profound implications for energy and climate policy. This paper summarises and critiques the arguments and evidence that have been cited in support of Jevons Paradox, focusing in particular on the work of Len Brookes and Harry Saunders. It identifies some empirical and theoretical weaknesses in these arguments, highlights the questions they raise for economic orthodoxy and points to some interesting parallels between these arguments and those used by the biophysical school of ecological economics. While the evidence in favour of Jevons Paradox is far from conclusive, it doessuggest that economy-wide rebound effects are larger than is conventionally assumed and that energy plays a more important role in driving productivity improvements and economic growth than is conventionally assumed.