Western economies are learning to live with Covid-19. As each successive wave of the coronavirus has washed over the West, the virus has wreaked less economic damage than the last time around.
Vaccines have been the decisive factor behind the improved resilience in the face of the latest surge driven by the more transmissible Delta variant, meaning rising caseloads are translated into far fewer hospitalizations and deaths.
In the U.K., where 88% of adults have received at least one vaccine shot, falling case numbers in the past week—and Covid-19 fatalities that have been much lower than in previous surges—have given rise to early hopes that the Delta surge is receding even after much of the country relaxed restrictions earlier this month.
But the improvement in economic performance from one surge to the next also reflects a host of adaptations to the pandemic by governments and businesses.
Governments across the U.S. and Europe have avoided imposing the drastic lockdowns that were a feature of the first surge of the pandemic, believing they could be more selective in their choice of restrictions and just as effective.
