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Navigating the financial fog: The impact of pandemic priming on economic decisions and future valuations

Author

Listed:
  • Bayer, Ya'akov M.
  • Shapir, Offer Moshe
  • Shapir-Tidhar, Michal H.
  • Shtudiner, Zeev

Abstract

The COVID-19 pandemic drastically impacted financial decision-making by introducing significant uncertainty and an influx of often conflicting information about future outcomes. Our study investigates the effects of priming on financial decision-making during the pandemic, focusing on how priming influences time and risk preferences. Using a sizable and diverse sample, we demonstrate that even short-term exposure to specific stimuli through priming can significantly shape individuals’ perceptions and decisions in a globally unstable economic context. Our findings reveal a substantial effect of negative priming on these preferences, highlighting the critical role of external information in influencing financial decisions during uncertain times. This study has significant implications for economic theory and practical applications, as it enhances the understanding of financial decision making processes under the pressure of a global crisis.

Suggested Citation

  • Bayer, Ya'akov M. & Shapir, Offer Moshe & Shapir-Tidhar, Michal H. & Shtudiner, Zeev, 2024. "Navigating the financial fog: The impact of pandemic priming on economic decisions and future valuations," Journal of Behavioral and Experimental Finance, Elsevier, vol. 44(C).
    • Handle: RePEc:eee:beexfi:v:44:y:2024:i:c:s2214635024001199
    DOI: 10.1016/j.jbef.2024.101004
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    More about this item

    Keywords

    Priming; Time preference; Risk preference; Pandemic; COVID-19; Decision making; Experiment;
    All these keywords.

    JEL classification:

    • C90 - Mathematical and Quantitative Methods - - Design of Experiments - - - General
    • D90 - Microeconomics - - Micro-Based Behavioral Economics - - - General
    • M37 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Advertising
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior

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