Abstract for: How Valuable is a COVID-19 Vaccine? Accounting for Health Impacts, Economic Activity, and Endogenous Behavioral Responses acros

The COVID-19 pandemic has shown that vaccines not only reduce infections, hospitalizations, and fatalities but also reduce the need for more disruptive Non-Pharmaceutical Interventions required to keep transmissions under control. Whereas typical assessments of vaccines account for direct benefits on the vaccinated individual, and occasionally the benefits to others due to reduced transmission risk, the indirect benefits through enhancing economic interactions are missing from current estimates. This paper provides the first account of COVID-19 vaccine benefits, both on average and incrementally, by combining direct life and hospitalization savings and indirect benefits due to reduced transmission and enhanced economic activity. The authors use a calibrated model of COVID-19 and GDP trajectories in 50 states of USA from the onset of pandemic until September 2022. They estimate time-varying benefits of COVID-19 vaccines across different states. The overall average vaccination cost savings are $39,298 and the marginal cost savings are $18,117 per vaccination. These comprehensive estimates show the nuanced interplay between economic and health benefits of vaccines, and can inform various applications, e.g. estimating the cost of vaccine mis-information.