Too Scared for School? The effects of terrorism on Israel (Job Talk)

This study analyzes the impact of terrorism on students’ academic achievement.
I exploit the temporal and geographical variation in terror attacks in Israel during
the Second Intifada, as well as the special structure of the Israeli end-of-high-school
exams, which allows observing the same student at multiple exams in different
dates. By exploring within student variation in test scores, I provide robust
evidence that the occurrence of a fatal terror attack shortly before an exam has a
significant adverse effect on students’ exam performances. The effect is transitory
and concentrated in the five days preceding the exam. It increases with the
number of fatalities and decreases with the distance between the student and the
attack location. These results indicate that psychological stress is an important
mechanism in the effect of terror on cognitive performance. Furthermore I show
that even when terror only temporarily impairs students’ learning and exam
performance, it has a lasting effect on human capital accumulation.