In 1865, the English economist William Stanley Jevons published “The Coal Question,” a book with a prosaic title that contained profound implications. Jevons set out to establish the size of England’s coal reserves, a critical question for industrial and naval power. During his research, he stumbled upon a curious paradox: As coal use became more efficient due to the advent of better quality steam engines, coal consumption rose rather than fell.
On the face it, this seems counter-intuitive. Improved efficiency leads to greater productivity which should lead to a resource savings. In fact, however, it meant just the opposite: As coal power got cheaper, people found more and more things to do with it. In the end, people consumed so much more coal at the lower price that the total amount spent on coal rose rather than fell. This phenomenon came to be labelled the “Jevons Paradox.”