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Vaccination and GDP Growth Rates: Exploring the Links in a Conditional Convergence Framework

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  • Masia, Neal A.
  • Smerling, Jonathan
  • Kapfidze, Tendayi
  • Manning, Richard
  • Showalter, Mark

Abstract

Vaccination rates vary significantly across countries, and the intensity of vaccination programs is a matter of public choice, infrastructure limitations, budget constraints, and many other factors. The link between better health and better economic performance is by now well established, and many vaccines have been shown to generate significant ROI in a classical cost-benefit framework. To our knowledge, the longer term macroeconomic benefits of improved vaccination programs have not been estimated. We modify the standard conditional convergence model to account for changes in vaccination rates across time and countries, and use the modified model to estimate the macroeconomic gains from improved vaccination rates, using the DTP vaccine as a proxy for vaccination programs generally. We find evidence to suggest economically and statistically significant and sustained increases in the GDP growth rate associated with lagged increases in vaccination rates; furthermore, we find these effects increasing over time. We find that investments of the sort made by the Global Alliance for Vaccination and Immunization (Gavi) are linked to measurably higher DTP rates, and we estimate the returns to such investments as at least 12:1. For countries on the threshold of graduating from Gavi, these results suggest that much is at stake: reducing investment in vaccination could reverse both the public health improvements and tangible economic benefits associated with ongoing improvements in vaccination rates.

Suggested Citation

  • Masia, Neal A. & Smerling, Jonathan & Kapfidze, Tendayi & Manning, Richard & Showalter, Mark, 2018. "Vaccination and GDP Growth Rates: Exploring the Links in a Conditional Convergence Framework," World Development, Elsevier, vol. 103(C), pages 88-99.
    • Handle: RePEc:eee:wdevel:v:103:y:2018:i:c:p:88-99
    DOI: 10.1016/j.worlddev.2017.10.013
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    References listed on IDEAS

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    Cited by:

    1. Herrera-Almanza, Catalina & Rosales-Rueda, Maria F., 2023. "Community-based health programs and child vaccinations: Evidence from Madagascar," World Development, Elsevier, vol. 170(C).
    2. Li, Shi & Li, Meng & Fu, Rongsha, 2024. "A sustainable pandemic response: The impact of COVID-19 vaccination coverage on economic policy uncertainty," International Review of Economics & Finance, Elsevier, vol. 92(C), pages 316-332.
    3. Klaus Gründler & Armin Hackenberger & Anina Harter & Niklas Potrafke, 2021. "Covid-19 Vaccination: The Role of Crisis Experience," CESifo Working Paper Series 9096, CESifo.
    4. Rouatbi, Wael & Demir, Ender & Kizys, Renatas & Zaremba, Adam, 2021. "Immunizing markets against the pandemic: COVID-19 vaccinations and stock volatility around the world," International Review of Financial Analysis, Elsevier, vol. 77(C).
    5. Giuseppe Gabrielli & Anna Paterno & Silvana Salvini & Isabella Corazziari, 2021. "Demographic trends in less and least developed countries: Convergence or divergence?," Journal of Population Research, Springer, vol. 38(3), pages 221-258, September.

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