Coronavirus Pandemic Shock, Economic Preferences and Beliefs: An Online Survey Experiment

Preferences and beliefs determine individual decision making. A growing body of research suggests that personal experience has a significant impact on these constructs. The diversity and breadth of the COVID-19 pandemic provide a unique, although grime, opportunity to identify the impact of catastrophic experience on economic reasoning and behaviour in both the short and long.

The COVID-19 pandemic has killed over a hundred thousand individuals around the world. For many this pandemic will have a particularly dramatic and gruesome effect because they live in or near one of the many epicentres. Many communities, though, have experienced comparatively minor – and in some cases essentially no – impact from this pandemic. We will explore this heterogeneity in online survey experiments in China, Italy, Chile, India, the UK and the US. We will use 1) geographical discontinuity and 2) “pre-treatment” measures of economic preferences to establish the causal influence of COVID-19 exposure on economic preferences and beliefs.

We will measure two groups of outcome variables. The first group represents the most widely studied economic preferences, namely risk aversion, time discounting and pro-social behaviour. The second group is belief updating, in both health and economic domains. We conjecture that individuals most intensely exposed to the CORVID-19 virus, and the resulting human suffering and deaths, will exhibit significantly different economic preferences and belief updating than those with much lower exposure. Our proposed field experiment is extremely timely and will provide novel insights into the economic aftermath of this tragic event, as well as necessary policy responses.