American Economic Journal:
Applied Economics
ISSN 1945-7782 (Print) | ISSN 1945-7790 (Online)
Direct and Indirect Effects of Vaccines: Evidence from COVID-19
American Economic Journal: Applied Economics
(pp. 1–43)
Abstract
We estimate direct and indirect vaccine effectiveness and assess how far the infection-reducing externality extends from the vaccinated, a key input to policy decisions. Our empirical strategy uses nearly universal microdata from a single state and relies on the six-month delay between 12- and 11-year-old COVID vaccine eligibility. Vaccination reduces cases by 80 percent, the direct effect. This protection spills over to close contacts, producing a household-level indirect effect about three-fourths as large as the direct effect. However, indirect effects do not extend to schoolmates. Our results highlight vaccine reach as important to consider when designing policy for infectious disease.Citation
Freedman, Seth, Daniel W. Sacks, Kosali Simon, and Coady Wing. 2026. "Direct and Indirect Effects of Vaccines: Evidence from COVID-19." American Economic Journal: Applied Economics 18 (1): 1–43. DOI: 10.1257/app.20230717Additional Materials
JEL Classification
- D62 Externalities
- H51 National Government Expenditures and Health
- H75 State and Local Government: Health; Education; Welfare; Public Pensions
- I12 Health Behavior
- I18 Health: Government Policy; Regulation; Public Health
- J13 Fertility; Family Planning; Child Care; Children; Youth