Jevons Paradox: Counterproductive Outcomes in the Aviation Industry
The Jevons Paradox is an economic dilemma that arises when improvements in the efficiency of resource use (and associated reductions in the cost of consumption) unintentionally increase demand for the resource in the long term. English economist William Stanley Jevons first described the phenomenon in 1865, observing how improvements in the efficiency of coal use in steam engines led to higher levels of coal consumption in Britain (OECD). Many energy and climate policies of today, including some carbon pricing instruments, “backfire” in a similar manner. The unexpected effects of such conservation efforts have implications for socio-economic urban systems.
The observation that consumers now fly more often, and to more distant destinations than before, is consistent with the law of demand. But their heightened desire for airline tickets corresponds with a significant increase in fuel use, which offsets any gains from the development of fuel-efficient technologies.
Advances in airplane technology have been necessary to improve the safety of air travel, besides economic efficiency. Thus, this case of the Jevons Paradox could not have been prevented. But modern aircraft engines achieve near maximum efficiency. As the industry approaches the limit to resource conservation gains from technological innovation, airlines must look beyond the engine bay to minimize their contribution to global carbon emissions.
Because U.S. carbon pricing policies are constrained by political economy factors, there is no single best solution to the challenge facing the aviation industry. It is unlikely that Americans will reduce their frequency of air travel in the near future, given the economical prices of tickets and the additional gains by connections from aviation (a positive consumption externality ☺), so perhaps stricter industry standards could be imposed concerning fuel inventory management by airlines. In any case, policymakers will need to be cognizant of undesired secondary rebounds generated by new regulatory instruments, ensuring that such effects do not impede progress toward sustainable development goals.
