The demand for a COVID-19 vaccine

Taking willingness to pay as primitive, this paper establishes an analytical framework for demand estimation, where the estimator is robust to endogeneity of price. Applying the framework, this paper then estimates demand functions for a COVID-19 vaccine and compute the consumer surplus in both China and the UAE. We find that the price elasticities of demand are mostly greater than one in both countries. An elastic demand suggests subsidy is likely to be successful in promoting vaccination. The consumer surplus is sizeable, around 58 billion US$ in China and 646 million US$ in the UAE. The figures can inform policymakers in assessing their vaccine programs.