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Catching the rebound: Economy-wide implications of an efficiency shock in the provision of transport services by households

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  • Koesler, Simon
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    Abstract

    We investigate the rebound effect of a 10% energy cefficiency improvement in the provision of private transport services by German households. In the process, we take into account that household behaviour may be influenced by habits, build on a detailed representation of the provision of private transport services, and disentangle the direct and indirect rebound effect. Our analysis shows that rebound has the potential to significantly reduce the expected energy savings of an energy efficiency improvement at households. In particular if households have a flexible demand structure, rebound can erode large parts of efficiency increases. Household habits have an initial detrimental effect on rebound. They limit the ability of households to adapt to changes in the prevailing price and income system and therewith temporally block parts of the channels that lead to rebound. In the long run, however, if habits are formed on the basis of historic consumption, habits do not affect rebound. In isolation, the direct and indirect rebound effect of the efficiency shock are positive, but direct rebound is much stronger. --

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    Paper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 13-082.

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    Date of creation: 2013
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    Handle: RePEc:zbw:zewdip:13082

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    Keywords: rebound; efficiency improvement; energy efficiency; habits;

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    1. Jeroen Bergh, 2011. "Energy Conservation More Effective With Rebound Policy," Environmental & Resource Economics, European Association of Environmental and Resource Economists, European Association of Environmental and Resource Economists, vol. 48(1), pages 43-58, January.
    2. Daron Acemoglu, 2001. "Directed Technical Change," NBER Working Papers 8287, National Bureau of Economic Research, Inc.
    3. Manuel Frondel & Nolan Ritter & Colin Vance, 2010. "Heterogeneity in the Rebound Eff ect – Further Evidence for Germany," Ruhr Economic Papers, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen 0227, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    4. Erik Dietzenbacher & Bart Los & Robert Stehrer & Marcel Timmer & Gaaitzen de Vries, 2013. "The Construction Of World Input--Output Tables In The Wiod Project," Economic Systems Research, Taylor & Francis Journals, Taylor & Francis Journals, vol. 25(1), pages 71-98, March.
    5. Manuel Frondel & Jorg Peters & Colin Vance, 2008. "Identifying the Rebound: Evidence from a German Household Panel," The Energy Journal, International Association for Energy Economics, International Association for Energy Economics, vol. 0(Number 4), pages 145-164.
    6. Patrizio Lecca & Peter McGregor & J. Kim Swales & Karen Turner, 2013. "The added value from a general equilibrium analyses of increased efficiency in household energy use," Working Papers, University of Strathclyde Business School, Department of Economics 1308, University of Strathclyde Business School, Department of Economics.
    7. Robert Stehrer & Gaaitzen J. de Vries & Los, Bart & Dietzenbacher, H.W.A. & Timmer, Marcel, 2014. "The World Input-Output Database: Content, Concepts and Applications," GGDC Research Memorandum, Groningen Growth and Development Centre, University of Groningen GD-144, Groningen Growth and Development Centre, University of Groningen.
    8. von Weizsacker, Carl Christian, 1971. "Notes on endogenous change of tastes," Journal of Economic Theory, Elsevier, Elsevier, vol. 3(4), pages 345-372, December.
    9. Sorrell, Steve & Dimitropoulos, John, 2008. "The rebound effect: Microeconomic definitions, limitations and extensions," Ecological Economics, Elsevier, Elsevier, vol. 65(3), pages 636-649, April.
    10. Pollak, Robert A, 1970. "Habit Formation and Dynamic Demand Functions," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 78(4), pages 745-63, Part I Ju.
    11. Alexeeva-Talebi, Victoria & Böhringer, Christoph & Löschel, Andreas & Voigt, Sebastian, 2012. "The value-added of sectoral disaggregation: Implications on competitive consequences of climate change policies," ZEW Discussion Papers 12-069, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    12. Koesler, Simon & Schymura, Michael, 2012. "Substitution elasticities in a CES production framework: An empirical analysis on the basis of non-linear least squares estimations," ZEW Discussion Papers 12-007, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
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