Applying COVID Vaccines in Economics Assessment Answers

In this video we explore some ideas for applying the issue of covid-19 vaccines to Economics assessment answers.

There are many micro and macroeconomic issues that can be linked to vaccine research, manufacturing and roll out across high and lower/middle-income nations.

Microeconomics of vaccines

• Vaccines as a good (public good aspect versus “rival” private good)
• Conditions of supply including factors influencing elasticity of supply, fixed and variable costs, average and marginal cost
• Derived demand for components used in making vaccines
• Economies of scale in vaccine manufacturing
• Vaccine market structure (an oligopoly), size of entry barriers
• Efficiency of health care systems in rolling out vaccinations
• Private costs & benefits from being vaccinated
• Information failures / causes of vaccine hesitancy / rationality
• Externalities from vaccines, social benefit-cost evaluation
• How should covid vaccines be priced? Should prices be regulated?
• Business objectives – are the world’s leading pharma companies profit maximisers? Is corporate social responsibility growing?
• Price discrimination in the global vaccine market
• Monopsony power among major vaccine purchasers
• Behavioural nudges – how to increase vaccine take-up?
• Game theory – co-operative agreements versus vaccine nationalism

Macroeconomics of vaccines

• Global economic damage inflicted by the pandemic – vaccines limiting hysteresis effects from the pandemic
• Macro impact of long covid - worsening mental health issues / lost education – damage to human capital
• Fiscal spending involved in delivering vaccines – judging the fiscal multiplier effects of state-funded roll-outs
• Linking vaccine research, testing and manufacturing to many positive aspects of globalisation
• Retreat into protectionism (such as vaccine nationalism)
• Revealed comparative advantage (consider the Serum Institute in India) – where will vaccines be manufactured? Who can supply them at lowest cost?
• Risks to progress in cutting extreme poverty
• Vaccines as a pathway towards normality, restoration of global tourism and other areas of trade
• Developing countries need greater financing and debt relief for COVID-19 vaccines and future pandemics