02630cas a2200313 a 4500 AALejournalIMF022212 230101c9999 xx r poo 0 0eng d 5.00 USD 9781557753540 1018-5941 BD-DhAAL BD-DhAAL Hansen, Niels-Jakob. COVID-19 Vaccines : A Shot in Arm for the Economy / Niels-Jakob Hansen, Rui C. Mano. Washington, D.C. : International Monetary Fund, 2021. 1 online resource (21 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students We quantify the effect of vaccinations on economic activity in the United States using weekly county level data covering the period end-2020 to mid-2021. Causal effects are identified through instrumenting vaccination rates with county-level pharmacy density interacted with state-level vaccine allocations, and by including county and state-time fixed effects to control for unobserved factors. We find that vaccinations are a significant and substantial shot in the arm of the economy. Specifically, an increase of initiated vaccination rates of 1 percentage point increases weekly consumer spending by 0.6 percent and reduces weekly initial unemployment claims by 0.004 percentage points of the 2019 labor force. Vaccinations also increase workrelated mobility. Importantly, we find that the effects vary with county characteristics. Specifically, urban counties and counties with initially worse socioeconomic conditions and lower education levels exhibit larger effects of vaccinations. This way, vaccinations are also a fair shot in the arm for the economy, which highlights that equitable distribution of vaccines is important to reduce inequality. Our results are specific to the United States, but hold important lessons for the expected economic impact of vaccinations in other countries. Mode of access: Internet Central Banks and Their Policies imf Market Structure and Pricing imf Monetary Policy imf Production, Pricing, and Market Structure imf Size Distribution of Firms imf Mano, Rui C. IMF Working Papers; Working Paper ; No. 2021/281 Full text available on IMF http://elibrary.imf.org/view/journals/001/2021/281/001.2021.issue-281-en.xml IMF e-Library