[hawkinspeter]

From https://www.bristolpost.co.uk/news/bristol-news/extreme-frustration-after-bristol-activists-8913213

[quote=Reclaim Our Community]

“We are a group of young people angered and fearful of the world we are inheriting. The UN estimate 1 billion climate refugees by 2050, how did Europe cope with a mere 1 million Syrian refugees in 2015?

“Irreversible feedback loops may have already been triggered, or will soon be set off: through the destruction and retreat of the Amazon rainforest, the melting of permafrost in the Artic circle and the bleaching of coral reefs. This could lead to spiralling ecological collapse.

“By now, everyone agrees that the climate crisis is immediate, grave and caused by human activity. Although our means of tackling this issue are not unified.

“After pursuing many democratic avenues in an attempt to affect change: writing to MPs, attending dozens of peaceful protests, working with the Green Party. No real change has occurred.

“In fact we see the opposite: we see the government support 100 new licenses for oil and gas, which led the Parliament’s Public Accounts Committee to say that “the Government has no coordinated plan towards achieving the net zero emissions by 2050 target”. We are left with no other option. If the institutions of power will not affect the necessary change, we must do so ourselves.”[/quote]

Topic

[David9694]

Doesn’t the UK-India trade

Doesn’t the UK-India trade deal have a significant bearing on this? 

[chrisonabike]

Remind me why 11pm is not my

Remind me why 11pm is not my best time for economics (not that there’s a good time for me)!

Your summary sounds good (“If the price rises outweigh the efficiency gains then the opportunity cost still goes up and usage will go down”.)  (for this hour).  Assuming demand is elastic.

If demand is inelastic usage may not decrease (much).  And if price rises don’t wipe out efficiency gains we’re on the side of things that Jevons described.  (Given that whoever makes the improvement doesn’t have a monopoly in the market or on the more efficient process, or there is not a cartel situation – and none of these things are usually very long-lasting – although that’s another rabbit hole!).

As Jevons originally stated it was the extra profit which tended to increase the attractiveness of an industry and increase output / reduce prices and fuel demand.  Or indeed in related industries (it was demand for energy – coal – he addressed in the original).

Phew!  Anyway – I’m pretty sure the general trend of humanity (although with many significant ups and downs) has not been towards “lower environmental footprint” and certainly not “using less resources” (outside of some specific local situations).

Of course we are the cooperative chimpanzee – we could change that.  However that would demand a rather high level of agreement / unity (which might be unpalatable).  And a much longer term vision than people have generally managed to show.  And likely more regulation / “interference in the markets” than our politicians have shown willing or ability to do effectively.

Keep cycling!

[Rich_cb]

The point of Jevon’s paradox
The point of Jevon’s paradox is that efficiency makes using more of the resource attractive by reducing the opportunity cost.

If you bought a car with double the fuel efficiency the opportunity cost of each journey drops increasing the likelihood of you making a journey.

To be precise Jevon’s paradox relies on the opportunity cost falling and this can happen with static prices or rising prices if the efficiency gains outweigh the price rises.

If the price rises outweigh the efficiency gains then the opportunity cost still goes up and usage will go down.

[chrisonabike]

Rich_cb wrote:

Rich_cb wrote:

Jevon’s paradox relies on the price of whatever you’re consuming remaining static. When prices increase, as they have done for fossil fuels, increased efficiency is a tool to return overall costs to their previous lower level via decreased consumption. A properly administered carbon tax could help to drive this efficiency.

Does it?  Not aware of that requirement in any formulations I’ve seen.  Although it’s only Jevons paradox if rebound goes above 100% – otherwise it’s just reducing what the improved efficiency that would be achieved if nothing else changed.

Is your idea assuming that the amount of consumption will remain static?  It may in some cases of course, but empirical observation of rebound suggests that it often doesn’t.

Not an economist but as I understand it if you change something you create a new environment.  So potentially all the previous fixed known or steady values can change as the system (people) re-adapts – it’s not just that the world goes on as before but we use less resources for this one process.

Of course it might be that our new efficiency saving exactly balances increase in price (as e.g. resource gets scarcer) – but this would be unlikely.  It would be possible to set taxes to “take up the slack” also I guess.

EDIT (for clarity I hope…)

[hawkinspeter]

Rich_cb wrote:

Rich_cb wrote:

As to your plumbing example, assuming that there is still a market for small scale plumbers, if your highly efficient plumber is sufficiently more efficient than their rivals then eventually they’ll increase market share until, either they dislodge the big companies or the big companies copy their efficiencies. Either way efficiency wins.

That’s how it should happen in theory, but in practise the size of a business or at least its market share are far more important than its efficiency. Many small businesses find it very difficult to compete as they likely don’t get to make deals with suppliers (due to the power imbalance between large suppliers and small businesses) whereas the largest companies will get big discounts or often be able to dictate what the suppliers can charge them (c.f. supermarkets and dairy farmers). This leads to the real problem of businesses becoming almost monopolies which is the usual aim for Capitalist businesses.

I agree about the need for regulation and legislation to curb the rampant expansion of dominant businesses, but again, the largest corporations will be able to wield their power over politicians and political systems. There’s the issue with regulatory capture which means that the interests of the corporation will override the interests of the public. (e.g. corporations exploiting tax/accountancy loopholes to avoid paying taxes)

The Capitalist theory is that efficiency will win, but that’s not what happens in real life and there needs to be much stricter controls in place to try to re-balance markets as the size of the business is far more important than efficiency.

[rdaddict]

Trustafarians at it again..
Trustafarians at it again..

[Rich_cb]

Jevon’s paradox relies on the
Jevon’s paradox relies on the price of whatever you’re consuming remaining static.

When prices increase, as they have done for fossil fuels, increased efficiency is a tool to return overall costs to their previous lower level via decreased consumption.

A properly administered carbon tax could help to drive this efficiency.

[Rich_cb]

There’s a lot to unpick there
There’s a lot to unpick there but essentially a lot of what you describe is a failure of basic regulation.

It’s perfectly possible to have full blooded capitalism with minimum wage laws and safety regulations.

Your criticism appears to boil down to the fact that capitalist enterprises cut costs wherever possible. That’s also the basis of my point. Why go through the hassle of a dispute with your employees if you can save more money and therefore derive more profit by increasing energy efficiency?

As to your plumbing example, assuming that there is still a market for small scale plumbers, if your highly efficient plumber is sufficiently more efficient than their rivals then eventually they’ll increase market share until, either they dislodge the big companies or the big companies copy their efficiencies. Either way efficiency wins.

[hawkinspeter]

chrisonatrike wrote:

“Capitalism” is simply about making profit.  It might drive efficiency … in making money.  (Even that needs qualification of course because we’re humans with all kinds of other goals and quirky heuristics, not “econs”.  Also I don’t know if there is any space where we approach the ideal of the free market – without a whole bunch of other rules.)

The making of profit can drive other kinds of efficiency – we obviously need some kind of feedback loop to motivate that.  (But noting Jevons paradox – if the overall goal is “making profit” then improving efficiency may drive increased consumption which will tend to compensate).

It can mean using less resources, or reducing ecological damage.  But that is not a given without adding other rules into the mix though (e.g. regulation).

The big problem with Capitalism is that it’s built upon a couple of incorrect assumptions.

Firstly, there’s the idea of a “free market” which requires people to have equal access to information in order to function correctly. Unfortunately, this is not at all what happens and most people have extremely limited access to the relevant information (often that information is kept internal to the business) whilst businesses have a huge incentive to mislead people as much as possible (see marketing/advertising).

Secondly, there’s the idea of traders having equal opportunity/power and that’s clearly incorrect as wealthy people have a massive advantage over the less wealthy. This also plays out with large companies having a big advantage over smaller ones.

The end result of these two issues is that wealth tends to get concentrated into fewer people’s hands and the inequality gap widens. The only way these two trends can continue is through authoritarianism and subjugation of the non-wealthy.

[chrisonabike]

…so perhaps this is a case

…so perhaps this is a case of “the markets here are either too free or not free enough”?

[hawkinspeter]

Rich_cb wrote:

Rich_cb wrote:

Capitalism is driven by profit. While that can encourage exploitation of resources it also ruthlessly seeks out efficiencies. It is that efficiency that makes capitalism a better fit for reducing environmental harm than its alternatives.

Unfortunately, those “efficiencies” are often basics such as paying workers a suitable wage or providing a safe working environment etc. A lot of the time, Capitalism is more concerned with shuffling money around in a shell game to avoid paying taxes rather than operating efficiently. Also, a lot of the profit is derived by ignoring external costs or at least pushing those external costs onto others (e.g. dumping sewage into rivers is cheaper than treating and disposing it in a responsible fashion).

Also, I would say that Capitalism is more based on people using their wealth and land ownership to exploit people who are in need of money/land. Profit is often the difference between paying employees what they are worth vs paying them the bare minimum that you can get away with.

Additionally, efficiency is far less important than the size of the business. You could be the most efficient plumber in all the land, but lose out to a large company that just employs a bunch of mediocre plumbers. There’s also the issue with barriers to entry for markets – this is often controlled by mega-corporations that lobby to get laws introduced that would penalise small companies and thus ensure that the dominant companies can maintain their market dominance. Usually it’s nothing about efficiency, but far more about power imbalance.

I can’t see that Capitalism has any mechanism to control environmental plundering – we’re going to have to rely on international cooperation, lawmakers and public opinion.

[chrisonabike]

Rich_cb wrote:

Rich_cb wrote:

You can look at consumption based emissions to take into account offshoring. These are also falling. Capitalism drives efficiency. If a process uses rare or hard to process materials there is a huge profit motive to adapt that process to use common and cheaper resources. Likewise with energy use, reducing the energy intensity of any process leads to more profit. …

“Capitalism” is simply about making profit.  It might drive efficiency … in making money.  (Even that needs qualification of course because we’re humans with all kinds of other goals and quirky heuristics, not “econs”.  Also I don’t know if there is any space where we approach the ideal of the free market – without a whole bunch of other rules.)

The making of profit can drive other kinds of efficiency – we obviously need some kind of feedback loop to motivate that.  (But noting Jevons paradox – if the overall goal is “making profit” then improving efficiency may drive increased consumption which will tend to compensate).

It can mean using less resources, or reducing ecological damage.  But that is not a given without adding other rules into the mix though (e.g. regulation).

[Rich_cb]

Capitalism is driven by
Capitalism is driven by profit. While that can encourage exploitation of resources it also ruthlessly seeks out efficiencies.

It is that efficiency that makes capitalism a better fit for reducing environmental harm than its alternatives.

[Rich_cb]

The point I was making was
The point I was making was that our ecological footprint is declining whilst our economy grows.

Which undermines the ‘degrowth’ argument somewhat.

[hawkinspeter]

wtjs wrote:

Capitalism drives exploitation

I agree that what he writes is tripe- it’s essentially the basis of ‘everything will be all right if we buy a Tesla and we can all drive around everywhere at 100mph’, because all the targets are repeatedly moved so they’re more than 5 years away and therefore don’t exist

Kicking the can down the road seems to be quite popular – we’ve been doing that for half a century.

[Author]

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