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  • 1 0000000404811396https://isni.org/isni/0000000404811396International Monetary Fund

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INTERNATIONAL MONETARY FUND

The Effects of COVID-19 Vaccines on Economic Activity

Pragyan Deb, Davide Furceri, Daniel Jimenez, Siddharth Kothari, Jonathan D. Ostry, and NourTawk.

WP/21/248

[2021] [OCT]

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© 2021 International Monetary Fund

The Effects of COVID-19 Vaccines on Economic Activity

WP/21/248

Pragyan Deb, Davide Furceri, Daniel Jimenez, Siddharth Kothari, Jonathan D. Ostry, and Nour Tawk

IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Abstract

This paper empirically examines the economic effects of COVID-19 vaccine rollouts using a cross-country daily database of vaccinations and high frequency indicators of economic activity—nitrogen dioxide (N02) emissions, carbon monoxide (CO) emissions, and Google mobility indices—for a sample of 46 countries over the period December 16,2020 to June 20, 2021. Using surprises in vaccines administered, we find that an unexpected increase in vaccination per capita is associated with a significant increase in economic activity. We also find evidence for non-linear effects of vaccines, with the marginal economic benefits being larger when vaccination rates are higher. Country-specific conditions play an important role, with lower economic gains if strict containment measures are in place or if the country is experiencing a severe outbreak. Finally, the results provide evidence of spillovers across borders, highlighting the importance of equitable access to vaccines across nations.

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The Effects of COVID-19 Vaccines on Economic Activity
Author: Mr. Pragyan Deb, Davide Furceri, Daniel Jimenez, Siddharth Kothari, Mr. Jonathan David Ostry, and Nour Tawk