Complex decision-making under stress: shallower search and impaired decision quality at different levels of computational hardness

Acute stress causes numerous physiological and psychological changes in humans, such as increased levels of cortisol and negative affect. To date, few studies have examined the effects of acute stress on objective decisions. To fill this gap, we conducted a within-participants laboratory experiment in which young adults made decisions of varying computational hardness under an acute stress and a placebo protocol. We find that higher cortisol levels, induced via the Trier Social Stress Test, drive impaired decision quality independent of the level of computational hardness. Among participants with significant increases in cortisol, we observe a reduction in decision quality and an increase in the rate of 'timing out' (using the maximum available time on a decision). Ex-post, we observe that the largest deficits in decision quality were on trials that 'timed out' in the stress condition. As important life decisions, such as financial decisions, are often made when experiencing acute stress, these results may have implications for the design of organisational and public policy.