Why making a more efficient car does not work

Let’s say the oil company has 100m tonnes of fuel in reserve, and at present levels that 1m cars on the roads, for example, each use 100 tonnes of fuel. The car companies make a new “eco” car which only uses 80 tonnes of fuel instead. The government replaces all the cars with these new “clean cars. Now the cars only altogether 80m tonnes of fuel.

But the oil company is not complaining. Knowing that the car companies see the opportunity to sell more cars, they wait patiently. Lowering the price point is but still making a better profit they sell 1.25m of these “eco” cars instead.

Now, we are still using 100m tonnes of fuel and the roads get more crowded also. A bit of a #wtf moment.

2 thoughts on “Why making a more efficient car does not work”

  1. Yes. People argue this isn’t the problem. I don’t agree. It is the problem.

    Is the car industry an elastic demand model or not – that is the question.

    Thanks for putting a name to the problem. Jevon’s Paradox.


  2. Jevons paradox! The more efficient something is, the more we use of it. I read about this paradox and it reinforced the obvious notion that the solution to what’s ailing us as a species lies mostly within, not with technological fixes.

    Liked by 1 person

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