Do COVID-19 Vaccines Reduce Mortality Only Through Direct Protection, or Also by Slowing Community Transmission?

This study investigates whether COVID-19 vaccines reduce mortality only through direct protection of vaccinated individuals or also via indirect effects by lowering virus transmission in the population. Using detailed data from Israel during the rapid vaccine rollout in early 2021, the authors exploit geographic variation in vaccination rates across age groups and localities. They find that a 10 percentage point increase in adult vaccination rates leads to a 1.4%–1.9% decline in mortality among unvaccinated children, indicating substantial indirect effects. The results suggest that vaccines not only protect recipients but also provide community-level benefits, reinforcing the public health value of broad coverage.

Full Citation and Link to Article

Freedman, S. M., Sacks, D. W., Simon, K. I., & Wing, C. (2025, forthcoming). Direct and Indirect Effects of Vaccines: Evidence from COVID‑19. American Economic Journal: Applied Economics. https://doi.org/10.1257/app.20230717

Extended Summary

Central Research Question

The article “Direct and Indirect Effects of Vaccines: Evidence from COVID-19” seeks to answer a critical policy question: Do vaccines reduce COVID-19 mortality not only by directly protecting vaccinated individuals but also by indirectly protecting others in the community through reduced viral transmission? This distinction is important for evaluating the full public health benefits of vaccination campaigns. While clinical trials provide strong evidence of direct protection, understanding the indirect effects—especially in real-world settings—is essential for guiding vaccine prioritization, public messaging, and policy design. The authors investigate these indirect effects during Israel’s rapid and highly age-targeted COVID-19 vaccine rollout in early 2021.

Previous Literature

A large body of literature confirms that vaccines provide strong direct protection against infection, severe disease, and death. Early randomized trials of the Pfizer-BioNTech and Moderna vaccines reported efficacy rates exceeding 90% against symptomatic COVID-19. Observational studies later corroborated these findings in real-world populations. However, evidence on indirect effects—how vaccines protect unvaccinated individuals by lowering transmission—has been more limited.

Previous research on other infectious diseases, such as influenza, has documented herd immunity effects in community and school settings. For COVID-19, early studies suggested that vaccines reduced transmission by lowering viral load and shortening infection duration. Some observational studies, including analyses from the U.K. and Israel, showed associations between community-level vaccination rates and lower incidence in unvaccinated groups. Still, isolating causal indirect effects at the population level remained challenging due to confounding and simultaneity in vaccine uptake and epidemic dynamics.

This study advances the literature by using quasi-experimental variation in vaccination timing across regions and age groups in Israel to provide credible causal evidence on the indirect mortality effects of vaccines, especially among unvaccinated children who were ineligible for vaccines during the study period.

Data

The study uses comprehensive national-level administrative data from Israel, which was one of the first countries to conduct a mass COVID-19 vaccination campaign. The data span January to May 2021, during which over 60% of Israeli adults were vaccinated, primarily with the Pfizer-BioNTech vaccine.

Key data sources include:

• COVID-19 mortality records: Weekly death counts by locality and age group.

• Vaccination records: Weekly data on cumulative vaccine uptake by 10-year age bins and geographic locality.

• Population data: Age-specific population counts by locality to compute mortality rates.

• Supplementary data: Information on COVID-19 infection rates, non-pharmaceutical interventions, and socio-demographic variables.

The sample focuses on 213 localities (including cities and local councils) and covers all age groups, though the core analysis targets unvaccinated children under age 16—who were ineligible for vaccination until June 2021—to assess indirect effects.

Methods

To estimate indirect vaccine effects, the authors exploit two key features of Israel’s vaccination campaign:

1. Age prioritization: The vaccine rollout began with older age groups (60+) and expanded to younger adults over time. This generated variation in vaccine coverage across age cohorts that is plausibly exogenous to local COVID-19 trends.

2. Geographic variation: Localities experienced different rates and timing of vaccine uptake due to demographic, cultural, and logistical factors. This creates spatial variation that can be leveraged to estimate spillover effects.

The core empirical strategy is a difference-in-differences (DiD) approach, combined with event-study and instrumental variable (IV) designs. The authors estimate how changes in adult vaccination rates in each locality and week affect mortality rates among unvaccinated children in the same locality and time.

The preferred specification includes locality and week fixed effects to absorb unobserved time-invariant factors and national trends. The key regressor is the cumulative share of adults (ages 20–49 or 20–59) who have received at least one dose. Robustness checks include alternative age groupings, lagged effects, and placebo tests using pre-vaccination periods.

An instrumental variable (IV) approach uses lagged vaccine eligibility by age to predict current vaccination rates. This helps address potential simultaneity bias from reverse causality or omitted variable bias due to differential spread of COVID-19 across regions.

Findings/Size Effects

The authors find clear and statistically significant evidence that higher local adult vaccination rates reduce mortality among unvaccinated children, indicating the presence of strong indirect effects. The key findings are as follows:

1. Magnitude of Indirect Effects: A 10 percentage point increase in adult vaccination coverage is associated with a 1.4% to 1.9% decline in weekly mortality among unvaccinated children. These effects are robust across specifications and consistent with estimates of herd immunity from prior epidemiological models.

2. Timing of Effects: Indirect effects emerge within a few weeks of increased adult vaccination and persist over the medium term. Lag structures show that mortality reductions among children track closely with changes in adult vaccination rates, suggesting a causal link rather than coincidental decline.

3. Heterogeneity: Indirect benefits are strongest in localities with higher baseline transmission and in larger, denser communities. This suggests that indirect protection is mediated by reduced exposure in high-contact settings, consistent with standard disease transmission models.

4. Placebo Tests: In placebo periods before the start of the vaccine rollout, there is no association between adult “vaccination” and child mortality, confirming that observed effects in 2021 are not driven by spurious trends or selection.

5. Robustness and IV Results: Instrumental variable estimates based on age eligibility yield similar point estimates, reinforcing the interpretation that these are causal effects of vaccination rather than confounded associations. IV coefficients are slightly larger, suggesting potential attenuation bias in ordinary least squares (OLS) estimates.

6. Policy Implications: The authors estimate that a one-standard-deviation increase in adult vaccination could prevent about 3 child deaths per million population per week. Extrapolated over time and space, these effects are substantial and suggest meaningful public health benefits from indirect protection.

Conclusion

This study provides some of the clearest empirical evidence to date that COVID-19 vaccines offer substantial indirect benefits in addition to their well-known direct effects. By examining the Israeli vaccination campaign, the authors show that higher adult vaccination rates reduce mortality among unvaccinated children—who could not benefit from direct protection during the study period. These findings suggest that vaccines contribute to community-level protection and help curb virus spread even among those who remain unvaccinated.

The results have important implications for public health strategy. First, they reinforce the rationale for high vaccine coverage as a means of achieving herd immunity. Second, they justify policies that promote vaccination not only for individual health but for community well-being. Third, they highlight the need to communicate the full scope of vaccine benefits in public messaging, especially in contexts of vaccine hesitancy.

By rigorously quantifying the indirect effects of vaccination on mortality, the study advances both scientific understanding and policy evaluation of vaccination programs. It provides a powerful empirical argument for comprehensive vaccination efforts, especially in the early stages of a pandemic when full population coverage may not yet be feasible. The broader implication is that vaccine-induced herd effects can be a critical lever for protecting vulnerable and ineligible populations, including children, immunocompromised individuals, and those with medical contraindications.