Dealing with environmental savings in a dynamical economy-how to stop chasing your tail in the pursuit of sustainability

In most countries people are urged to change their pattern of consumption and lifestyle in a less-energy consuming and more environmental-friendly direction. But gains in ecoefficiency are likely to be annihilated by a larger consumption — the so-called rebound effect — resulting in an increased throughput in the economy. Here is an obvious contradiction. Another contradiction entails from the fact that most governments strive to promote economic growth which includes increased consumption. The paper takes a look at various means to handle these contradictions in order to avoid or balance the rebound effect. Environmental policies (including such measures as green taxes) may redirect consumption from one kind to another but this demands that the alternative spending is less harmful than the one dissuaded from. Two other tested means are to alter the sector mix of the economy and to shorten the working hours — work sharing — to match the increasing efficiency.