Jevons Paradox
Making a resource more efficient to use increases its total consumption (rather than decreasing) because the lower cost drives a big surge in overall demand
In 1865, William Stanley Jevons1 found that improvements in efficiency to coal-burning engines actually led to an increase in how much coal was consumed (not decreased). This happened because a more efficient engine made it okay for more appliances to run and thus increased demand.
What this means is just because things get faster/more efficient, it won’t mean it’ll reduce demand. It can actually increase it.
Conditions #
There are some conditions required for Jevons paradox to apply:
- Technological change increases efficiency
- The efficiency boost decreases consumer price for such goods or services
- The reduced price drastically increase quantity demanded