Macro Analysis /
United States of America

Economics Thinking - Mass vaccination in 2021: What could possibly go wrong?

    Daniel Vernazza
    Daniel Vernazza

    Chief International Economist

    Chiara Silvestre
    Edoardo Campanella
    19 January 2021
    Published byUniCredit
    • The single most important determinant of the economic outlook is health policy and, ultimately, the way out of the pandemic is mass vaccination. Our base case is that, in the US and Europe, the vaccination programs go reasonably well and herd immunity is approached by year-end. But there is a lot that can go wrong.
    • There are three main concerns. First, how many people will get the vaccine? The rollout has so far been underwhelming, although the pace is picking up. For herd immunity, a high bar of at least 60% of the population would need to be vaccinated (or infected), and the bar is higher if vaccines with lower efficacy are used and for more infectious variants of the virus. But most worryingly of all, a significant proportion of people still say they would decline a vaccine, which could make herd immunity unachievable in some cases.
    • Second, there is uncertainty regarding how long immunity lasts for, both via vaccination and past infection, and whether the current suite of vaccines can protect against new, more infectious, variants. Once immunity wanes, the vaccination process must start over again.
    • Third, several emerging economies are lagging behind in terms of pre-ordered vaccines. This means that different parts of the world are likely to achieve herd immunity at different times.