The term is used in a number of fields. In economics it refers to instances when a new development is introduced to an economic activity with the expectation that it will improve that activity, but where an often unexpected negative effect occurs, which often offsets the positive effect. For instance, building more bridges is meant to relieve congestion, which it does. But the lighter traffic encourages more people to drive, creating more congestion. Or increasing car fuel efficiency makes driving cheaper, which leads to more people driving more or further, and using more fuel.
In environmental matters, “improving energy efficiency may save less energy than expected due to a rebound of energy use.” Besides direct rebound effect, it can trigger indirect effects. Fuel costs savings by car drivers from greater car efficiency can be spent on more air travel which negates energy savings.
Such rebound effects can be minimized by various policies, including taxes on the rebounding activity. And research suggest that the extent of rebound effect is limited, accounting for perhaps 5-30% of reduced energy savings.
Some further ideas to explore on Rebound Effect:
Identify a recently purchased piece of equipment or product that is supposed to save energy and determine whether there is any rebound effect associated with it.
What is the extent of the rebound effect associated with your recent purchase?
How can the rebound effect be reduced or minimized?
David Font Vivanco, et al., “The foundations of the environmental rebound effect and its contribution towards a general framework,” Ecological Economics (May 2016). bit.ly/3Zz5pzX
Kenneth Gillingham, David Rapson, and Gernot Wagner, “The Rebound Effect and Energy Efficiency Policy,” Review of Environmental Economics and Policy (September 25, 2015). bit.ly/3m1ov3O
“What is the rebound effect,” Umwelt Bundesamt (17 Sept 2019). bit.ly/3GdjEn5
Kenneth Gillingham, et al., “The rebound effect is overplayed,” Nature (22 Jan 2013). go.nature.com/3K0etrH
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