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Optimal Age-Based Vaccination and Economic Mitigation Policies for the Second Phase of the Covid-19 Pandemic

Andrew Glover, Jonathan Heathcote () and Dirk Krueger ()

No 636, Staff Report from Federal Reserve Bank of Minneapolis

Abstract: In this paper, we ask how to best allocate a given time-varying supply of vaccines across individuals of different ages during the second phase of the Covid-19 pandemic . Building on our previous heterogeneous household model of optimal economic mitigation and redistribution (Glover et al., 2021), we contrast the actual vaccine deployment path, which prioritized older, retired individuals, with one that first vaccinates younger workers. Vaccinating the old first saves more lives but slows the economic recovery, relative to inoculating the young first. Vaccines deliver large welfare benefits in both scenarios (relative to a world without vaccines), but the old-first policy is optimal under a utilitarian social welfare function. The welfare gains from having vaccinated the old first are especially significant once the economy is hit by a more infectious Delta variant in the summer of 2021.

Keywords: COVID-19; Vaccination paths (search for similar items in EconPapers)
JEL-codes: E21 E63 (search for similar items in EconPapers)
Date: 2022-01-18
New Economics Papers: this item is included in nep-dge, nep-his and nep-mac
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Related works:
Journal Article: Optimal age-Based vaccination and economic mitigation policies for the second phase of the covid-19 pandemic (2022) Downloads
Working Paper: Optimal Age-Based Vaccination and Economic Mitigation Policies for the Second Phase of the COVID-19 Pandemic (2021) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedmsr:93646

DOI: 10.21034/sr.636

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