Harvard Economist N. Gregory Mankiw Endorses Idea of Paying People to Take a Covid Vaccine
In a recent New York Times column, prominent Harvard economist (and former Bush Administration Council of Economic Advisers Chair) N. Gregory Mankiw endorses the idea of paying people to take a Coronavirus vaccine, when it becomes available. The proposal was first presented by Robert Litan of the Brookings Institution. I commented on Litan’s idea in this post (where I also suggested some modifications). Here is an excerpt from Mankiw’s piece:
What’s the best way to get the economy back on track after the Covid-19 recession? Simple: Achieve herd immunity. And what’s the best way to achieve herd immunity? Again, simple: Once a vaccine is approved, pay people to take it.
That bold proposal comes from Robert Litan, an economist at the Brookings Institution. Congress should enact it as quickly as possible….
Recent research by the University of Chicago economists Austan Goolsbee and Chad Syverson has found that the government-mandated shutdowns account for just a small part of the decline in economic activity. The main reason people aren’t spending is that they are afraid to leave their homes and contract the virus….
Even if stock prices remain near record highs, spending, employment and production won’t fully recover until the fear of catching the virus dissipates.
That’s why the solution to America’s macroeconomic woes will have to come from microbiology. Nine vaccines are already in Phase 3 trials. It is most likely only a matter of time before at least one of them is approved….
Once a vaccine becomes available, however, another challenge arises: getting people to take it. In a recent NBC News/SurveyMonkey Weekly Tracking Poll, only 44 percent of Americans said they would get the vaccine. The rest said they wouldn’t or weren’t sure….
Those numbers are troublingly low. No vaccine will be 100 percent effective, which means that getting vaccinated won’t be sufficient to protect yourself from the virus. But if enough people get vaccinated, society will develop herd immunity. With widespread, even if imperfect, vaccination, the virus won’t be able to spread. No one knows for sure, but experts believe that 70 to 90 percent of the population will need to be vaccinated.
Immunology, meet economics. One of the first principl
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