IDEAS home Printed from https://ideas.repec.org/a/eee/energy/v34y2009i3p370-376.html
   My bibliography  Save this article

Energy rebound and economic growth: A review of the main issues and research needs

Author

Listed:
  • Madlener, R.
  • Alcott, B.

Abstract

Contrary to conventional wisdom, more efficient use of energy may actually through rebound effects lead to greater instead of less total consumption of energy—or at least to no diminution of energy consumption. If so, energy efficiency strategies may serve goals of raising economic growth and affluence, but as an environmental or energy policy strategy could backfire, leading to more resource use in absolute terms rather than less. This, in turn, could in the long run hamper economic growth, for instance if resource scarcity crowds out technical change. The hypothesis that rebound is greater than unity (‘backfire’) predicts the observed real-world correlation between rising energy consumption and rising efficiency of energy services, however difficult it may be to define a precise holistic metric for the latter. The opposing hypothesis, i.e. that rebound is less than unity and that energy efficiency increases therefore result in less energy consumption than before, requires on the other hand strong forces that do account for the empirically observed economic growth. This paper summarises some of the discussions around the rebound effect, puts it into perspective to economic growth, and provides some insights at the end that can guide future empirical research on the rebound topic.

Suggested Citation

  • Madlener, R. & Alcott, B., 2009. "Energy rebound and economic growth: A review of the main issues and research needs," Energy, Elsevier, vol. 34(3), pages 370-376.
  • Handle: RePEc:eee:energy:v:34:y:2009:i:3:p:370-376
    DOI: 10.1016/j.energy.2008.10.011
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0360544208002934
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Birol, Fatih & Keppler, Jan Horst, 2000. "Prices, technology development and the rebound effect," Energy Policy, Elsevier, vol. 28(6-7), pages 457-469, June.
    2. N/A, 2006. "The UK Economy," National Institute Economic Review, National Institute of Economic and Social Research, vol. 196(1), pages 40-59, April.
    3. Saunders, Harry D., 2000. "A view from the macro side: rebound, backfire, and Khazzoom-Brookes," Energy Policy, Elsevier, vol. 28(6-7), pages 439-449, June.
    4. Arthur, W Brian, 1989. "Competing Technologies, Increasing Returns, and Lock-In by Historical Events," Economic Journal, Royal Economic Society, vol. 99(394), pages 116-131, March.
    5. Sorrell, Steve & Dimitropoulos, John, 2008. "The rebound effect: Microeconomic definitions, limitations and extensions," Ecological Economics, Elsevier, vol. 65(3), pages 636-649, April.
    6. Ayres, Robert U. & Warr, Benjamin, 2005. "Accounting for growth: the role of physical work," Structural Change and Economic Dynamics, Elsevier, vol. 16(2), pages 181-209, June.
    7. Warr, Benjamin & Schandl, Heinz & Ayres, Robert U., 2008. "Long term trends in resource exergy consumption and useful work supplies in the UK, 1900 to 2000," Ecological Economics, Elsevier, vol. 68(1-2), pages 126-140, December.
    8. A. Greening, Lorna & Greene, David L. & Difiglio, Carmen, 2000. "Energy efficiency and consumption -- the rebound effect -- a survey," Energy Policy, Elsevier, vol. 28(6-7), pages 389-401, June.
    9. Warr, Benjamin & Ayres, Robert, 2006. "REXS: A forecasting model for assessing the impact of natural resource consumption and technological change on economic growth," Structural Change and Economic Dynamics, Elsevier, vol. 17(3), pages 329-378, September.
    10. Arrow, Kenneth & Bolin, Bert & Costanza, Robert & Dasgupta, Partha & Folke, Carl & Holling, C.S. & Jansson, Bengt-Owe & Levin, Simon & Mäler, Karl-Göran & Perrings, Charles & Pimentel, David, 1996. "Economic growth, carrying capacity, and the environment," Environment and Development Economics, Cambridge University Press, vol. 1(01), pages 104-110, February.
    11. Weisz, Helga & Krausmann, Fridolin & Amann, Christof & Eisenmenger, Nina & Erb, Karl-Heinz & Hubacek, Klaus & Fischer-Kowalski, Marina, 2006. "The physical economy of the European Union: Cross-country comparison and determinants of material consumption," Ecological Economics, Elsevier, vol. 58(4), pages 676-698, July.
    12. Dahlstrom, Kristina & Ekins, Paul, 2006. "Combining economic and environmental dimensions: Value chain analysis of UK iron and steel flows," Ecological Economics, Elsevier, vol. 58(3), pages 507-519, June.
    13. David L. Greene, 1992. "Vehicle Use and Fuel Economy: How Big is the "Rebound" Effect?," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1), pages 117-144.
    14. Mario Giampietro & Kozo Mayumi, 1998. "Another View of Development, Ecological Degradation, and North-South Trade," Review of Social Economy, Taylor & Francis Journals, vol. 56(1), pages 20-36.
    15. repec:dau:papers:123456789/10972 is not listed on IDEAS
    16. Brookes, L. G., 1978. "Energy policy, the energy price fallacy and the role of nuclear energy in the UK," Energy Policy, Elsevier, vol. 6(2), pages 94-106, June.
    17. Costanza, Robert, 1995. "Economic growth, carrying capacity, and the environment," Ecological Economics, Elsevier, vol. 15(2), pages 89-90, November.
    18. Smulders, Sjak & de Nooij, Michiel, 2003. "The impact of energy conservation on technology and economic growth," Resource and Energy Economics, Elsevier, vol. 25(1), pages 59-79, February.
    19. Harty D. Saunders, 1992. "The Khazzoom-Brookes Postulate and Neoclassical Growth," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 131-148.
    20. Jackson, Tim, 2002. "Evolutionary psychology in ecological economics: consilience, consumption and contentment," Ecological Economics, Elsevier, vol. 41(2), pages 289-303, May.
    21. de Haan, Peter & Mueller, Michel G. & Peters, Anja, 2006. "Does the hybrid Toyota Prius lead to rebound effects? Analysis of size and number of cars previously owned by Swiss Prius buyers," Ecological Economics, Elsevier, vol. 58(3), pages 592-605, June.
    22. Roy, Joyashree, 2000. "The rebound effect: some empirical evidence from India," Energy Policy, Elsevier, vol. 28(6-7), pages 433-438, June.
    23. Greenhalgh, Geoffrey, 1990. "Energy conservation policies," Energy Policy, Elsevier, vol. 18(3), pages 293-299, April.
    24. Rhee, Hae-Chun & Chung, Hyun-Sik, 2006. "Change in CO2 emission and its transmissions between Korea and Japan using international input-output analysis," Ecological Economics, Elsevier, vol. 58(4), pages 788-800, July.
    25. Soytas, Ugur & Sari, Ramazan, 2003. "Energy consumption and GDP: causality relationship in G-7 countries and emerging markets," Energy Economics, Elsevier, vol. 25(1), pages 33-37, January.
    26. Brookes, Leonard, 2000. "Energy efficiency fallacies revisited," Energy Policy, Elsevier, vol. 28(6-7), pages 355-366, June.
    27. Binswanger, Mathias, 2001. "Technological progress and sustainable development: what about the rebound effect?," Ecological Economics, Elsevier, vol. 36(1), pages 119-132, January.
    28. Schipper, Lee & Grubb, Michael, 2000. "On the rebound? Feedback between energy intensities and energy uses in IEA countries," Energy Policy, Elsevier, vol. 28(6-7), pages 367-388, June.
    29. Alan S. Manne & Richard G. Richels, 1990. "CO2 Emission Limits: An Economic Cost Analysis for the USA," The Energy Journal, International Association for Energy Economics, vol. 0(Number 2), pages 51-74.
    30. J. Daniel Khazzoom, 1980. "Economic Implications of Mandated Efficiency in Standards for Household Appliances," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 21-40.
    31. Richard B. Howarth, 1997. "Energy Efficiency And Economic Growth," Contemporary Economic Policy, Western Economic Association International, vol. 15(4), pages 1-9, October.
    32. Rosenberg,Nathan, 1994. "Exploring the Black Box," Cambridge Books, Cambridge University Press, number 9780521459556, April.
    33. Kummel, Reiner & Henn, Julian & Lindenberger, Dietmar, 2002. "Capital, labor, energy and creativity: modeling innovation diffusion," Structural Change and Economic Dynamics, Elsevier, vol. 13(4), pages 415-433, December.
    34. Alcott, Blake, 2005. "Jevons' paradox," Ecological Economics, Elsevier, vol. 54(1), pages 9-21, July.
    Full references (including those not matched with items on IDEAS)

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:energy:v:34:y:2009:i:3:p:370-376. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: http://www.journals.elsevier.com/energy .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.