4 ms·

Reverse Jevons Paradox

62 points by martinhath 2mo ago

subhajeet2107 2mo ago
[dead]
xg15 2mo ago
> you might effectively kill a whole class of changes, like "small refactor" PRs. Or the changes might be "smuggled through" in an unrelated changeset that has to go through the red tape anyway.
greenfish6 2mo ago
Now that I think about it, it's very easy to point to reverse jevon's paradoxes. Regulations around building housing, large org bloat + processes, when the stupid form fill that i need to fill out gets too long on some website...
- jaynetics 2mo ago
  Indeed. My first thought was that this is a roundabout name for ordinary "rulebook slowdown", but of course there are other ways to increase the cost of useful behavior, not just rules. It leads to an interesting way to think about company and civic health as well. Instead of focussing purely on incentives, one might assume that many are inclined to do good stuff anyway, and then ask: are we lowering the cost of all desired behavior as much as possible? And are we doing it for as many people as possible?
cubefox 2mo ago
> If you make it hard to change code by requiring multiple levels of reviews, a web of Jira tickets, a horde of people needing to sign off, and other red tape, you might effectively kill a whole class of changes I remember this theater on things which were suspected to be too expensive with insiffiufficient ROI to implement, except that all the time wasted by multiple people arguing in Jira tickets, sitting in meetings, and writing specifications was likely far more expensive than just building and testing the thing. For some reason, there seems to be a strong and automatic tendency for older and larger organizations to drift toward petrification through bureaucratization.
deleted 2mo ago
[deleted]
malkia 2mo ago
Or also called bureaucracy
nbernard 2mo ago
> Jevons paradox happens when the cost of a resource goes down, but the total spend on that resource goes up. I would argue that is not Jevons paradox but standard supply and demand (and this "reverse Jevons paradox" too). Jevons paradox occurs when a more efficient use of a resource leads to an increase in its use (instead of a decrease as a first order analysis would suggest).
- fxwin 2mo ago
  I think it's still valid to see this as an example of the Jevons paradox: Your resource is money, and reduced per-unit cost means you are using your money (resource) more efficiently. If the total spend now goes up instead of stagnating or decreasing, you've got Jevons
- deleted 2mo ago
  [deleted]
- friendzis 2mo ago
  > I would argue that is not Jevons paradox but standard supply and demand (and this "reverse Jevons paradox" too). Kinda yes. How do you derive total spend from supply-demand curves? Multiply price and quantity at an intersection point. Likewise, you can predict total spend by multiplying p and q on the demand curve. The difference in total spend is difference between these areas. For the total spend to increase with a drop in price, the the demand must rise faster. Jevon's paradox implies that the price equilibrium is at the highly elastic portion of the demand curve. > Jevons paradox occurs when a more efficient use of a resource leads to an increase in its use While that's mostly true in practical reality in established economies, that does not strictly have to be the case. On the consumer side, especially in manufacturing, there's very little difference between unit price of a good falling and input unit per output units dropping as both lead to decreased COGS. In both cases, market realities might unlock alternative approaches (the classic being robot replacing Robert), leading to increased demand.
- jpfromlondon 2mo ago
  you are absolutely correct, the author is putting the cart before the horse.
geraneum 2mo ago
The author has discovered the red tape.
smitty1e 2mo ago
> if the cost of a resource goes up, the total spend on that resource can go down. Not unlike hiking taxes on the rich, seeing them vote with their feet, and revenue subsequently catering. But as long as we reward politicians for delivering blame more than results, this political folly will continue. Until Strein's Law[1] kicks the teeth in. [1] https://en.wikipedia.org/wiki/Herbert_Stein#Stein's_Law https://en.wikipedia.org/wiki/Herbert_Stein#Stein's_Law
- neilwilson 2mo ago
  Except that revenue doesn’t crater in a floating exchange rate system. Revenue from them craters but the money moves elsewhere and revenue improves there - including an increase in total transactions. Total revenue will always be Total spend less what people decide to financially save rather than spend. Because tax are percentages and the process is a geometric series.
  - AnthonyMouse 2mo ago
    "Vote with their feet" means relocating to another jurisdiction. The other jurisdiction doesn't necessarily have to use a different currency, e.g. if businesses move from California to Texas, they both use US dollars. Likewise any two countries that both use Euros. Moreover, when the destination jurisdiction does use a different currency, that increases demand for the destination currency and reduces demand for the original currency, i.e. it devalues the original currency. And then even if your revenue was the same in nominal dollars it would have declined in real dollars. On top of that, non-uniform tax rates break your model wide open. The entities who leave can exchange their currency (independently of whether it gets devalued) for assets, so that the amount of currency (as distinct from wealth, since it's an equal value exchange) increases in the hands of the people who pay lower tax rates. Which likewise has a negative impact on revenue, since they pay lower tax rates.
pu_pe 2mo ago
Jevons Paradox is called a paradox because it is non-intuitive. It is very intuitive to conclude that when costs go up, people will use less of that thing.
- markild 2mo ago
  I think it's a paradox in the same way that the non-reverse is. The spending might go down more than it's proportion of price increase. An example not anchored in anything: If public transit costs x, I'll use it every day. If public transit suddenly costs 2x, I'm not gonna use it every other day, I'll rather find an alternative and use 0.
  - layla5alive 2mo ago
    Should be more like 'caution' than 'reverse-paradox'
janpeuker 2mo ago
> The cost of making small changes to the codebase is so high that it becomes net-negative for a single developer to make the change That's called Software Engineering at Google
- layla5alive 2mo ago
  And several other big tech with bad cultures
- aswegs8 2mo ago
  Wait I thought the testing and release pipelines at Google are super fast?
deleted 2mo ago
[deleted]
z3t4 2mo ago
In micro economics theory they call this price elasticity where you try lowering the price to see how much more customers buy and you plot that to a graph calculator to get a curve and the bend on the curve is the price elasticity. Then you can calculate the optimal price to maximize sales.
- amelius 2mo ago
  But you want to maximize profit, not sales.
  - kingleopold 2mo ago
    "your margin is my opportunity".
deleted 2mo ago
[deleted]
chvid 2mo ago
Will it happen to memory? I am looking at you guys, electron apps.
- chvid 2mo ago
  If you had the right OS support for JS apps - all those apps that package a full chrome browser all of a sudden would have close to zero memory footprint.
- Yizahi 2mo ago
  A very old joke: - Dad, dad, have you seen - the prices went up so much! Does this mean you will stop drinking now? - No son, this means you will eat less.
jihadjihad 2mo ago
I can’t tell if this is a troll post or not, but either way, the concept the author seems to be looking for is called the “Law of Demand” [0]. 0: https://en.wikipedia.org/wiki/Law_of_demand https://en.wikipedia.org/wiki/Law_of_demand
- qiaoqian 2mo ago
  exactly the Law of Demand, it is more intuitive
- alan-crowe 2mo ago
  Not a troll. As recently as the 1870s, when Jevons, Menger, and Walras pioneered the Marginal Revolution in economics, this was a deep new insight about elasticity. Imagine yourself a shop keeper, hoping to boost the money coming in at the till. If you increase prices by 10%, you will get more? Right? That depends on the elasticity of demand. If the elasticity is two, the drop in demand is twice the increase in price. 0.8 times 1.1 is 0.88. Takings fall from $100 to $88. But if the elasticity is one half, the drop in demand is half the increase in price. 0.95 times 1.1 is 1.045. Takings rise from $100 to $104.5. When the price goes up the shop always sells less goods, (Law of Demand) but that still leaves it unclear whether more or less money goes in the till. This is first year University economics today. Back in 1865, it was obvious to every-one that the increased efficiency of steam engines would lead to a reduced demand for coal. Jevons pointed out that increased efficiency makes steam power cheaper. Goodbye water wheel, hello steam engine. More steam engines, greater consumption of steam power, any-one who wants to make a prediction needs to invent the concept of elasticity and try to measure it. Greater than one? Less than one? That is going to decide whether total demand rises or falls.
  - abanana 2mo ago
    It was first-year GCSE (age 14-15) economics for me. But yes that's exactly it, the author appears to have discovered the price elasticity concept, as a refinement of the Law of Demand.
  - fluoridation 2mo ago
    >Back in 1865, it was obvious to every-one that the increased efficiency of steam engines would lead to a reduced demand for coal. Jevons pointed out that increased efficiency makes steam power cheaper. Well, in that case you're talking about an entirely different phenomenon. Jevons's paradox (as defined by this post) happens when the cost of a resource decreases and the spend on that resource increases. You're talking about what happens to the spend on resource A when the cost of resource B decreases. Whether it rises or falls, it won't be Jevons's paradox.
raincole 2mo ago
> if the cost of a resource goes up, the total spend on that resource can go down ... must be a satire post, right? This is just the most plain and intuition result.
hellojomp 2mo ago
> “if the cost of a resource goes up, the total spend on that resource can go down” This is tautologically true in the limiting case of infinite cost.
alexpotato 2mo ago
One of my favorite examples of this kind of thing is requiring a ticket for every change. There is a class of changes that take very little time but have a positive impact. If the cost of making a ticket for that change exceeds the cost of the ticket, it's human nature that some people just won't make the change. This is a bit of a contrived example (e.g. you could bundle multiple small changes into one ticket) but it's still a good example of a policy meant to make things better actually leading to fewer improvements.
- throwatdem12311 2mo ago
  Not an issue for me anymore. I make a change, then tell the agent to make the ticket too. lol
elil17 2mo ago
I think that this person does not know what the Jevons Paradox is. The Jevons Paradox is that increasing the efficiency with which a resource is used may increase the total amount of that resource that is used. Consuming more because costs went down isn't the Jevons paradox - it's spending more because costs went down. So if you give all your coders a great test harness and they run more tests because it takes up less of their time, that's not the Jevons paradox. If you give your coders a great test harness and then they go from spending 10% of work hours on testing to spending 20% of work hours on testing because testing has such a good ROI now, that's the Jevons paradox.
- bonoboTP 2mo ago
  Jevons Paradox has become a meme lately because it can be used effectively in a particular type of online argument to sound smart and checkmate the other. But as you say, the popular use is nothing mysterious, just microeconomics. At a certain level of technological development, supply and demand curves meet at a point and it yields a price. If technology develops and makes production more efficient, that crossover point moves, and now more demand can be met. The popular meme idea of scoffing at road construction because it will just make more people drive misanthropically ignores that driving isn't purely emissions but it also gets people to places where they want to go, like visiting family and friends or allows them to live at a different place from where they work if that's more affordable or more to their liking. The road capacity led to more cars on the road, but also to more real demand being met. Now of course, there can be such a thing as totally frivolous additional usage, though one needs a specific value system to judge it whether a trip was virtuous or sinful. Meanwhile real Jevons is a very particular effect that doesn't show up on all road graphs and doesn't simply mean that opening up more lanes will attract more traffic.
  - fluoridation 2mo ago
    >The popular meme idea of scoffing at road construction because it will just make more people drive misanthropically ignores that driving isn't purely emissions but it also gets people to places where they want to go, like visiting family and friends or allows them to live at a different place from where they work if that's more affordable or more to their liking. People scoff at road construction (or rather, road widening) as a solution to congestion. I don't think anyone is under the impression that kilometers driven would go down as road bandwidth goes up. >The road capacity led to more cars on the road, but also to more real demand being met. No, not necessarily. Maybe some people who would have otherwise used public transport opt to drive instead. Making roads wider could literally make them less efficient, in terms of humans moved per hour per meter of width.
sokoloff 2mo ago
“If delta-x is negative, then delta-y can be positive.” It seems like there’s a straightforward/obvious corollary that reverses the sign on both clauses. (Walk the curve in the opposing direction.)
mpenick 2mo ago
I liked this footnote. A simple, intuitive explanation. > If you pay $1.00 to press a button, and pressing the button pays you $0.99, you > will press the button zero times. If you get $1.01 instead, you will press the > button all the time. One thought: If it only gives you $0.01 profit you'll (have to) push it more than if it gave you $1000 profit. There's a saturation point.
bonoboTP 2mo ago
I thought this would be about the actual reverse effect, namely that if something gets too cheap, people don't want it anymore. Which would have been also an interesting article, regarding status symbols and luxury items.

62 points by martinhath 2mo ago

[dead]

xg15 2mo ago

> you might effectively kill a whole class of changes, like "small refactor" PRs. Or the changes might be "smuggled through" in an unrelated changeset that has to go through the red tape anyway.

greenfish6 2mo ago

Now that I think about it, it's very easy to point to reverse jevon's paradoxes. Regulations around building housing, large org bloat + processes, when the stupid form fill that i need to fill out gets too long on some website...

jaynetics 2mo ago
Indeed. My first thought was that this is a roundabout name for ordinary "rulebook slowdown", but of course there are other ways to increase the cost of useful behavior, not just rules. It leads to an interesting way to think about company and civic health as well. Instead of focussing purely on incentives, one might assume that many are inclined to do good stuff anyway, and then ask: are we lowering the cost of all desired behavior as much as possible? And are we doing it for as many people as possible?

cubefox 2mo ago

> If you make it hard to change code by requiring multiple levels of reviews, a web of Jira tickets, a horde of people needing to sign off, and other red tape, you might effectively kill a whole class of changes I remember this theater on things which were suspected to be too expensive with insiffiufficient ROI to implement, except that all the time wasted by multiple people arguing in Jira tickets, sitting in meetings, and writing specifications was likely far more expensive than just building and testing the thing. For some reason, there seems to be a strong and automatic tendency for older and larger organizations to drift toward petrification through bureaucratization.

deleted 2mo ago

[deleted]

malkia 2mo ago

Or also called bureaucracy

nbernard 2mo ago

> Jevons paradox happens when the cost of a resource goes down, but the total spend on that resource goes up. I would argue that is not Jevons paradox but standard supply and demand (and this "reverse Jevons paradox" too). Jevons paradox occurs when a more efficient use of a resource leads to an increase in its use (instead of a decrease as a first order analysis would suggest).

fxwin 2mo ago
I think it's still valid to see this as an example of the Jevons paradox: Your resource is money, and reduced per-unit cost means you are using your money (resource) more efficiently. If the total spend now goes up instead of stagnating or decreasing, you've got Jevons
deleted 2mo ago
[deleted]
friendzis 2mo ago
> I would argue that is not Jevons paradox but standard supply and demand (and this "reverse Jevons paradox" too). Kinda yes. How do you derive total spend from supply-demand curves? Multiply price and quantity at an intersection point. Likewise, you can predict total spend by multiplying p and q on the demand curve. The difference in total spend is difference between these areas. For the total spend to increase with a drop in price, the the demand must rise faster. Jevon's paradox implies that the price equilibrium is at the highly elastic portion of the demand curve. > Jevons paradox occurs when a more efficient use of a resource leads to an increase in its use While that's mostly true in practical reality in established economies, that does not strictly have to be the case. On the consumer side, especially in manufacturing, there's very little difference between unit price of a good falling and input unit per output units dropping as both lead to decreased COGS. In both cases, market realities might unlock alternative approaches (the classic being robot replacing Robert), leading to increased demand.
jpfromlondon 2mo ago
you are absolutely correct, the author is putting the cart before the horse.

geraneum 2mo ago

The author has discovered the red tape.

smitty1e 2mo ago

> if the cost of a resource goes up, the total spend on that resource can go down. Not unlike hiking taxes on the rich, seeing them vote with their feet, and revenue subsequently catering. But as long as we reward politicians for delivering blame more than results, this political folly will continue. Until Strein's Law[1] kicks the teeth in. [1] https://en.wikipedia.org/wiki/Herbert_Stein#Stein's_Law https://en.wikipedia.org/wiki/Herbert_Stein#Stein's_Law

neilwilson 2mo ago
Except that revenue doesn’t crater in a floating exchange rate system. Revenue from them craters but the money moves elsewhere and revenue improves there - including an increase in total transactions. Total revenue will always be Total spend less what people decide to financially save rather than spend. Because tax are percentages and the process is a geometric series.
- AnthonyMouse 2mo ago
  "Vote with their feet" means relocating to another jurisdiction. The other jurisdiction doesn't necessarily have to use a different currency, e.g. if businesses move from California to Texas, they both use US dollars. Likewise any two countries that both use Euros. Moreover, when the destination jurisdiction does use a different currency, that increases demand for the destination currency and reduces demand for the original currency, i.e. it devalues the original currency. And then even if your revenue was the same in nominal dollars it would have declined in real dollars. On top of that, non-uniform tax rates break your model wide open. The entities who leave can exchange their currency (independently of whether it gets devalued) for assets, so that the amount of currency (as distinct from wealth, since it's an equal value exchange) increases in the hands of the people who pay lower tax rates. Which likewise has a negative impact on revenue, since they pay lower tax rates.

pu_pe 2mo ago

Jevons Paradox is called a paradox because it is non-intuitive. It is very intuitive to conclude that when costs go up, people will use less of that thing.

markild 2mo ago
I think it's a paradox in the same way that the non-reverse is. The spending might go down more than it's proportion of price increase. An example not anchored in anything: If public transit costs x, I'll use it every day. If public transit suddenly costs 2x, I'm not gonna use it every other day, I'll rather find an alternative and use 0.
- layla5alive 2mo ago
  Should be more like 'caution' than 'reverse-paradox'

janpeuker 2mo ago

> The cost of making small changes to the codebase is so high that it becomes net-negative for a single developer to make the change That's called Software Engineering at Google

layla5alive 2mo ago
And several other big tech with bad cultures
aswegs8 2mo ago
Wait I thought the testing and release pipelines at Google are super fast?

deleted 2mo ago

[deleted]

z3t4 2mo ago

In micro economics theory they call this price elasticity where you try lowering the price to see how much more customers buy and you plot that to a graph calculator to get a curve and the bend on the curve is the price elasticity. Then you can calculate the optimal price to maximize sales.

amelius 2mo ago
But you want to maximize profit, not sales.
- kingleopold 2mo ago
  "your margin is my opportunity".

deleted 2mo ago

[deleted]

chvid 2mo ago

Will it happen to memory? I am looking at you guys, electron apps.

chvid 2mo ago
If you had the right OS support for JS apps - all those apps that package a full chrome browser all of a sudden would have close to zero memory footprint.
Yizahi 2mo ago
A very old joke: - Dad, dad, have you seen - the prices went up so much! Does this mean you will stop drinking now? - No son, this means you will eat less.

jihadjihad 2mo ago

I can’t tell if this is a troll post or not, but either way, the concept the author seems to be looking for is called the “Law of Demand” [0]. 0: https://en.wikipedia.org/wiki/Law_of_demand https://en.wikipedia.org/wiki/Law_of_demand

qiaoqian 2mo ago
exactly the Law of Demand, it is more intuitive
alan-crowe 2mo ago
Not a troll. As recently as the 1870s, when Jevons, Menger, and Walras pioneered the Marginal Revolution in economics, this was a deep new insight about elasticity. Imagine yourself a shop keeper, hoping to boost the money coming in at the till. If you increase prices by 10%, you will get more? Right? That depends on the elasticity of demand. If the elasticity is two, the drop in demand is twice the increase in price. 0.8 times 1.1 is 0.88. Takings fall from $100 to $88. But if the elasticity is one half, the drop in demand is half the increase in price. 0.95 times 1.1 is 1.045. Takings rise from $100 to $104.5. When the price goes up the shop always sells less goods, (Law of Demand) but that still leaves it unclear whether more or less money goes in the till. This is first year University economics today. Back in 1865, it was obvious to every-one that the increased efficiency of steam engines would lead to a reduced demand for coal. Jevons pointed out that increased efficiency makes steam power cheaper. Goodbye water wheel, hello steam engine. More steam engines, greater consumption of steam power, any-one who wants to make a prediction needs to invent the concept of elasticity and try to measure it. Greater than one? Less than one? That is going to decide whether total demand rises or falls.
- abanana 2mo ago
  It was first-year GCSE (age 14-15) economics for me. But yes that's exactly it, the author appears to have discovered the price elasticity concept, as a refinement of the Law of Demand.
- fluoridation 2mo ago
  >Back in 1865, it was obvious to every-one that the increased efficiency of steam engines would lead to a reduced demand for coal. Jevons pointed out that increased efficiency makes steam power cheaper. Well, in that case you're talking about an entirely different phenomenon. Jevons's paradox (as defined by this post) happens when the cost of a resource decreases and the spend on that resource increases. You're talking about what happens to the spend on resource A when the cost of resource B decreases. Whether it rises or falls, it won't be Jevons's paradox.

raincole 2mo ago

> if the cost of a resource goes up, the total spend on that resource can go down ... must be a satire post, right? This is just the most plain and intuition result.

hellojomp 2mo ago

> “if the cost of a resource goes up, the total spend on that resource can go down” This is tautologically true in the limiting case of infinite cost.

alexpotato 2mo ago

One of my favorite examples of this kind of thing is requiring a ticket for every change. There is a class of changes that take very little time but have a positive impact. If the cost of making a ticket for that change exceeds the cost of the ticket, it's human nature that some people just won't make the change. This is a bit of a contrived example (e.g. you could bundle multiple small changes into one ticket) but it's still a good example of a policy meant to make things better actually leading to fewer improvements.

throwatdem12311 2mo ago
Not an issue for me anymore. I make a change, then tell the agent to make the ticket too. lol

elil17 2mo ago

I think that this person does not know what the Jevons Paradox is. The Jevons Paradox is that increasing the efficiency with which a resource is used may increase the total amount of that resource that is used. Consuming more because costs went down isn't the Jevons paradox - it's spending more because costs went down. So if you give all your coders a great test harness and they run more tests because it takes up less of their time, that's not the Jevons paradox. If you give your coders a great test harness and then they go from spending 10% of work hours on testing to spending 20% of work hours on testing because testing has such a good ROI now, that's the Jevons paradox.

bonoboTP 2mo ago
Jevons Paradox has become a meme lately because it can be used effectively in a particular type of online argument to sound smart and checkmate the other. But as you say, the popular use is nothing mysterious, just microeconomics. At a certain level of technological development, supply and demand curves meet at a point and it yields a price. If technology develops and makes production more efficient, that crossover point moves, and now more demand can be met. The popular meme idea of scoffing at road construction because it will just make more people drive misanthropically ignores that driving isn't purely emissions but it also gets people to places where they want to go, like visiting family and friends or allows them to live at a different place from where they work if that's more affordable or more to their liking. The road capacity led to more cars on the road, but also to more real demand being met. Now of course, there can be such a thing as totally frivolous additional usage, though one needs a specific value system to judge it whether a trip was virtuous or sinful. Meanwhile real Jevons is a very particular effect that doesn't show up on all road graphs and doesn't simply mean that opening up more lanes will attract more traffic.
- fluoridation 2mo ago
  >The popular meme idea of scoffing at road construction because it will just make more people drive misanthropically ignores that driving isn't purely emissions but it also gets people to places where they want to go, like visiting family and friends or allows them to live at a different place from where they work if that's more affordable or more to their liking. People scoff at road construction (or rather, road widening) as a solution to congestion. I don't think anyone is under the impression that kilometers driven would go down as road bandwidth goes up. >The road capacity led to more cars on the road, but also to more real demand being met. No, not necessarily. Maybe some people who would have otherwise used public transport opt to drive instead. Making roads wider could literally make them less efficient, in terms of humans moved per hour per meter of width.

sokoloff 2mo ago

“If delta-x is negative, then delta-y can be positive.” It seems like there’s a straightforward/obvious corollary that reverses the sign on both clauses. (Walk the curve in the opposing direction.)

mpenick 2mo ago

I liked this footnote. A simple, intuitive explanation. > If you pay $1.00 to press a button, and pressing the button pays you $0.99, you > will press the button zero times. If you get $1.01 instead, you will press the > button all the time. One thought: If it only gives you $0.01 profit you'll (have to) push it more than if it gave you $1000 profit. There's a saturation point.

bonoboTP 2mo ago

I thought this would be about the actual reverse effect, namely that if something gets too cheap, people don't want it anymore. Which would have been also an interesting article, regarding status symbols and luxury items.