Stress or failure? An experimental protocol to distinguish the environmental determinants of decision-making

Are economic decisions affected by short-term stress, failure, or both? Such effects have not been clearly distinguished in previous experimental research, and have the potential to worsen economic outcomes, especially in disadvantaged socioeconomic groups. We validate a novel experimental protocol to examine the individual and combined influences of stress, failure, and success. The protocol employs a 2x3 experimental design in two sessions and can be used online or in laboratory studies to analyse the impact of these factors on decision-making and behaviour. The stress protocol was perceived as significantly more stressful than a control task, and it induced a sizeable and significant rise in state anxiety. The provision of negative feedback ("failure") significantly lowered participants' assessment of their performance, induced feelings of failure, and raised state anxiety.