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The —the idea of "reduce, reuse and recycle"—has long been promoted as one solution to the environmental crisis. Instead of the old "take, make, use, throw away" model, it aims to keep materials in play for as long as possible.

In fashion, this means going well beyond traditional repair habits and shopping secondhand. It entails innovations such as clothing rental platforms, , and AI tools that cut waste in supply chains and sort textiles for recycling.

This sounds like a win-win: less waste, fewer raw materials used, and a lighter footprint on the planet. But in fact, these innovations could end up making things worse.

In our , we found that innovations in the circular economy—especially in the textiles and clothing industry—can trigger what's called a "backfire rebound effect." This is where the production and consumption of clothing rises, potentially wiping out any environmental gains. It happens when efficiency improvements lower costs and make products seem more sustainable, tempting consumers to buy more.

The rebound effect is an index measuring how innovation affects production—ranging from below zero ("super conservation": the best outcome for the environment) to above one ("backfire": the worst), with a range of outcomes in between.

It's not a new concept. In 1865, British economist observed that improvements in coal efficiency actually led to more coal being burned. Today, the same dynamics can occur in fashion.

Recycled clothing, marketed as eco-friendly, may tempt people to buy more. And if fashion brands then scale up—at home or abroad—the negative environmental impact is amplified, wiping out many of the gains from recycling.

Until now, no studies had quantified the rebound effect for the global textile industry. Clothing and textiles are widely held to be the world's sector after energy, consuming around 20% of the world's water every year, emitting 1.7 billion tonnes of COâ‚‚ annually (about 10% of global emissions), and generating 92 million tonnes of waste each year. of this waste is recycled into new garments.

With annual global production of new textiles projected to climb to by 2030 (from 124 million tonnes in 2023), the speed of this growth means there is a clear need for more recycling and reuse. Yet our research suggests that environmental innovations could actually lead to increased levels of global textile consumption.

Specifically, we found a —a strikingly high figure. This means that for every 1% gain in environmental textile innovation, there will be an increase in new textile production of 0.6%.

We can think of it in terms of cars that become more fuel-efficient: instead of saving petrol, people may drive more. In the same way, rather than easing pressure on the planet, innovation in textiles is fueling more production and harm. What we really need is a rebound effect below 1 (a "partial rebound")—or better still, below zero (super conservation).

What causes this special rebound in textiles?

When an efficient recycling innovation is introduced, production costs drop, similar to the example of the fuel-efficient cars. Consumers, drawn by lower prices and the moral appeal of "sustainable" products, increase their purchases. Businesses see opportunities to expand into new markets. Soon, the gains from the innovation are overwhelmed by rising demand, leaving the planet worse off.

This doesn't mean for fashion should be abandoned—but they need guardrails. In our simulations, a Pigouvian tax (a tax on damaging behavior) was effective in reducing the rebound effect.

The greater the efficiency gains from circular innovations, the higher the tax required to prevent unsustainable consumption. For textiles, we found that a 10% efficiency gain from circular innovation—such as fiber-to-fiber recycling or AI sorting—requires a minimum uniform tax of 1.25% on production to prevent backfire (full rebound). A 2.5% tax could reduce the rebound to manageable levels (partial rebound).

Use of taxes to reduce rebound effect of environmental textile innovations

Other traditional policy tools could achieve similar results, including production caps on new clothes, incentives for longer lifespans for products, and measures to encourage genuinely sustainable consumption.

And because the rebound effect is not uniform across the world, such policies require both international coordination and measures that are specific to individual regions.

For example, in Bangladesh, where textiles account for more than and employ millions of people, blunt curbs on fast fashion could devastate livelihoods. Yet it is demand from wealthy countries for cheap clothing that fuels this dependence. Policies must therefore balance global environmental goals with local economic realities.

But the challenge goes deeper—right to the tension between a growth-driven economic system and the planet's limits. (the controversial but increasingly discussed idea that populations could voluntarily curb production and consumption) asks whether true sustainability is possible if economies remain dependent on increasing consumption.

Behavioral change is crucial—this means embracing minimalism, reusing more, and buying only what truly adds value. In the fashion world, this could mean campaigns that promote repairing clothes and cutting back on consumption, backed by policies that guide consumers towards these more sustainable habits.

Real-life examples already exist. France has a that refunds part of the cost of mending clothes. The works in the UK, Europe and Australia as a public–private partnership to cut waste across the fashion sector. And schemes like the , and aim to shift production towards more sustainable practices.

is the first to quantify the rebound effect of circular economy innovation in textiles at both global and regional scales. Its findings suggest a nuanced reality: circularity can help, yet without additional changes it risks accelerating the problems it was meant to solve.

We believe that measuring this rebound effect is key if policies are to deliver in practice. The fashion industry needs to back its sustainability promises with evidence, not just good intentions.

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