Jabbing the economy back to life?

ABSTRACT

The pace and scope of Covid-19 vaccination has varied greatly across OECD countries. In this paper, monthly data on vaccination rates for the 32 OECD countries with high-frequency all-cause mortality rates available are related to seven monthly economic activity indicators: night-time lights and Google Mobility reports for six types of locations. Vaccination rates are also related to Covid response stringency, to Covid cases and deaths, and to all-cause mortality. A standard deviation higher fully vaccinated rate is associated with up to an 0.5 standard deviation larger rise in economic activity over the same month in 2020; an effect due to relaxed response stringency. The partial vaccination rate has no relationship with the economic rebound. These associations with changes in economic activity occur despite no apparent relationship between vaccination rates and changes in Covid-19 cases or changes in mortality.

KEYWORDS:

• Covid-19
• google mobility
• mortality
• Night-Time lights
• vaccination

JEL CLASSIFICATION:

• I18
• O47

Acknowledgements

I am grateful to an anonymous reviewer for helpful comments and to Geua Boe-Gibson for processing the night-time lights images. There are no conflicts of interest to disclose and no funding was received. Data and code are available from the author.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

¹ For example, amongst 3.5 million people covered by a large U.S. health insurer vaccine efficacy (VE) fell ten percentage points per month for the Pfizer jab against Delta variant infections, and by eight points per month for other variants (Tartof et al. 2021). Cohn et al. (2022) study 0.78 million U.S. veterans, vaccinated with either Pfizer, Moderna, or J&J; VE against infection started at 86–89% but after six months had fallen sharply, to 13% (J&J), to 43% (Pfizer) or to 58% (Moderna).

² To translate into economic growth terms, a one SD higher mean stringency index in 2020 was associated with a 1.4% point lower GDP growth rate for these countries.

³ Relatedly, vaccination rates are positively associated with county-level increases in workplace mobility in the first half of 2021 in the United States (Hansen and Mano 2021).