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*A Negative Economic Shock is a large financial loss on earnings or accumulated assets. NES can be the outcome of psychosocial stressors (divorces, job losses, injuries) or traumatic events (violence, disasters)* *In this project, we try to understand what are the consequences on human behavior of being exposed to NES* You can read about it in the following papers: ------------------------------------------------------ **Negative Economic Shocks and the Compliance to Social Norms** *Bogliacino, Charris, Gómez, and Montealegre* **Abstract** We study why suffering a Negative Economic Shock (NES), i.e. a significant loss, may trigger a change in other-regarding behaviour. We conjecture that people trade off concern for money with a conditional preference to follow social norms and that suffering a shock makes extrinsic motivation more salient, leading to more norm violation. This result can be formally proved when preferences are norm-dependent. We study this question experimentally: After administering losses on the earnings from a Real Effort Task, we analyze choices in prosocial and antisocial settings. To derive our predictions, we elicit social norms for each context analyzed in the experiments. We find robust evidence that shock increases deviations from norms. ***Judgment and Decision-Making (2024)*** ------------------------------------------------------- **Crime-related Exposure to Violence and prosocial behavior: Experimental Evidence from Bogotá** *Bogliacino, Gómez and Grimalda* **Abstract** Victims of violence appear hypersensitive to cues and their brain reacts to triggers as if the past events were happening in the present. We assess to what extent recalling these negative experiences increases prosociality. We conduct two artefactual field experiments in Bogotá (Colombia) to test this hypothesis. Our methodological strategy is to experimentally manipulate the recall of violence, either through a direct question or through a monetary loss in participants’ experimental endowment. We interact these treatments with the degree of exposure to violence. We find that victims recalling experiences of urban violence act more prosocially in terms of trust, trustworthiness, and cooperation. The increase in prosociality favors residents in the same city district as the participant (ingroup bias). However, the ingroup bias holds in trust decisions but not in cooperation games decisions. ***Journal of Behavioral and Experimental Economics (2023)*** ------------------------------------------------------ **Negative shocks predict change in cognitive function and preferences: assessing the negative affect and stress hypothesis** *Bogliacino, Codagnone, Montealegre, Folkvord, Gómez, Charris, Liva, Lupiáñez-Villanueva, and Veltri* *Abstract* In the context of the current COVID-19 pandemic, households throughout the world have to cope with negative shocks. Previous research has shown that negative shocks impair cognitive function and change risk, time and social preferences. In this study, we analyze the results of a longitudinal multi-country survey conducted in Italy (N=1652), Spain (N=1660) and the United Kingdom (N=1578). We measure cognitive function using the Cognitive Reflection Test and preferences traits (risk, time and social preferences) using an experimentally validated set of questions to assess the differences between people exposed to a shock compared to the rest of the sample. We measure four possible types of shocks: labor market shock, health shock, occurrence of stressful events, and mental health shock. Additionally, we randomly assign participants to groups with either a recall of negative events (more specifically, a mild reinforcement of stress or of fear/anxiety), or to a control group (to recall neutral or joyful memories), in order to assess whether or not stress and negative emotions drive a change in preferences. Results show that people affected by shocks performed worse in terms of cognitive functioning, are more risk loving, and are more prone to punish others (negative reciprocity). Data do not support the hypotheses that the result is driven by stress or by negative emotions. ***Scientific Reports (2021)*** ------------------------------------------------------- **Do negative economic shocks affect cognitive function, adherence to social norms and loss aversion?** *Bogliacino and Montealegre* **Abstract** Households are frequently subject to income and asset shocks. We performed a lab experiment, inducing losses on a real effort task, after which we measured cognitive performance, loss aversion and cheating behavior. We found that asset losses, but not income losses, act as a cognitive load, by decreasing accuracy and increasing response times. We did not detect any change in dishonesty or loss aversion. ***Journal of the Economic Science Association (2020)*** ---------------------------------------------------------- **Exposure to and recall of violence reduce short-term memory and cognitive control** *Bogliacino, Grimalda, Ortoleva, and Ring* **Abstract** Previous research has investigated the effects of violence and warfare on individuals' well-being, mental health, and individual prosociality and risk aversion. This study establishes the short- and long-term effects of exposure to violence on short-term memory and aspects of cognitive control. Short-term memory is the ability to store information. Cognitive control is the capacity to exert inhibition, working memory, and cognitive flexibility. Both have been shown to affect positively individual well-being and societal development. We sampled Colombian civilians who were exposed either to urban violence or to warfare more than a decade earlier. We assessed exposure to violence through either the urban district-level homicide rate or self-reported measures. Before undertaking cognitive tests, a randomly selected subset of our sample was asked to recall emotions of anxiety and fear connected to experiences of violence, whereas the rest recalled joyful or emotionally neutral experiences. We found that higher exposure to violence was associated with lower short-term memory abilities and lower cognitive control in the group recalling experiences of violence, whereas it had no effect in the other group. This finding demonstrates that exposure to violence, even if a decade earlier, can hamper cognitive functions, but only among individuals actively recalling emotional states linked with such experiences. A laboratory experiment conducted in Germany aimed to separate the effect of recalling violent events from the effect of emotions of fear and anxiety. Both factors had significant negative effects on cognitive functions and appeared to be independent from each other. ***PNAS (2017)*** DOI: 10.1073/pnas.1704651114
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