An unintended consequence of COVID-19 immunity passports-quasi-experimental evidence of moral hazard observed after implementing the domestic Green Pass policy during the second wave of the COVID-19 pandemic in Italy.

Abstract

Amidst the second wave of the COVID-19 pandemic, Italian policymakers mandated to exhibit evidence of vaccination or immunity (the Green Pass) as a condition to access retail premises and public offices. This study aims to offer evidence, in a quasi-experimental setting, suggesting that an unintended consequence of this policy was the emergence of moral hazard. Google visit duration data measured the time customers typically spend on retail premises or public offices. A pairwise comparison of median visit time per premise was performed at a six-week interval before and after the introduction of the Green Pass. This study is the first to provide evidence of "ex-post" moral hazard associated with introducing a domestic Green Pass policy. The median visiting time on premises that required digital immunity control significantly increased after introducing the domestic Green Pass policy, contrary to other public premises where access remained free of limitations. The increase in median visit time in premises with faster customer turnaround, such as coffee shops (+49%) and fast-food restaurants (+45%), was lower than the increase observed for fine-dining restaurants (+74%) and pizzerias (+163%). No significant increase in median visit time was observed in premises where the Green Pass was not required, such as food supermarkets, retail non-food shops, post offices, banks, pharmacies, and gas stations. The evidence of moral hazard highlights the critical issue of unintended consequences stemming from public health policies. This discovery is pivotal for policymakers, indicating that unforeseen behavioral adjustments could offset the intended benefits despite the intent to reduce risk through measures like the Green Pass.