What is Jevons paradox?

The observation that improving the efficiency with which a resource is used can increase, rather than decrease, the total amount of that resource consumed.

Who discovered Jevons paradox?

English economist William Stanley Jevons, in his 1865 book The Coal Question, observing coal use after more efficient steam engines.

Does Jevons paradox mean efficiency is pointless?

No — efficiency still delivers value per unit. It means total consumption may not fall, so net resource effects must be measured, not assumed.

Jevons paradox

Also called the rebound effect · Economics

Jevons paradox is the counter-intuitive finding that making the use of a resource more efficient often increases total consumption of it — because greater efficiency lowers the effective cost and unlocks many new uses.

How it works

Efficiency is a price cut in disguise. When a resource gets cheaper to use, demand expands — more users, more applications — and the extra usage can outweigh the saving per unit, so the total goes up rather than down.

How to use it

Policy and forecasting: don’t assume an efficiency gain automatically cuts total resource use (energy, water, compute).
Strategy: cheaper inputs can grow a whole market rather than just trim costs.
Pair with second-order thinking on any “we made X more efficient” claim — ask what the lower cost will unleash.

Worked example

Economist William Jevons noticed in 1865 that more efficient steam engines didn’t reduce Britain’s coal use — they made coal-power cheaper, so it spread to more industries and total coal consumption rose. The pattern recurs: efficient lighting, engines, and computing have each expanded total usage.

Where it fails

It’s a tendency, not an iron law — the rebound can be partial, and the paradox doesn’t mean efficiency is futile. The real lesson is to measure the net effect rather than assume the per-unit saving is the whole story.

Frequently asked

What is Jevons paradox?: The observation that improving the efficiency with which a resource is used can increase, rather than decrease, the total amount of that resource consumed.
Who discovered Jevons paradox?: English economist William Stanley Jevons, in his 1865 book The Coal Question, observing coal use after more efficient steam engines.
Does Jevons paradox mean efficiency is pointless?: No — efficiency still delivers value per unit. It means total consumption may not fall, so net resource effects must be measured, not assumed.

Diminishing returns Supply and demand Second-order thinking Incentives Wikipedia: Jevons paradox

Editorial synthesis © ReadGlobe 2026, drawing on the mental-models tradition (Charlie Munger, Farnam Street) and the primary sources for each model. · Last reviewed 2026-06-30.