Shocks and Hopelessness: Evidence from Victims of Violence in Colombia

• Development Workshop

Date and Location

Monday, April 22, 2013, 4:10 PM - 5:30 PM
ARE Conference Room, 2102 Social Sciences and Humanities

Abstract

In this paper we analyze if a shock of violence that has severe material and psychological consequences induces a sense of helplessness and pessimism about the future. For this purpose, we bring together micro-level data on expectations of future household mobility, psychological stress, and exposure to violence from a sample of rural households in Colombia, some of which were victimized and displaced in the past ten years. We find that perceptions regarding the size of the shock to wellbeing, poor material conditions, and the severity of victimization induce overly pessimistic expectations about the individual’s ability to move out of poverty. These results thus suggest the incidence of learned helplessness among the displaced population, a condition that shatters hopes and aspirations and hinders the ability to undertake actions that would change future wellbeing. The shock of displacement could thus lead to pervasive economic behavior and to a behavioral poverty trap.