Behavioral Financial Responses to War Threat and Geopolitical Uncertainty

While war and geopolitical instability reconfigure household economic behavior, the psychological mechanisms underlying conservative online spending and financial planning in conflict-affected economies remain insufficiently understood. Drawing mainly on Protection Motivation Theory (PMT), this study examines whether threat appraisal (perceived vulnerability and severity) of war and geopolitical uncertainty, accompanied by coping appraisal (financial self-efficacy and response efficacy), is associated with online conservative spending, and whether coping appraisal is related to financial planning in Lebanon. Based on survey data from 262 relatively active Lebanese online consumers, perceived war threat vulnerability, rather than its severity or broader geopolitical instability, is found to be significantly related to online conservative spending. Perceived war severity and both geopolitical threat dimensions show no significant association. Regarding coping appraisal, the findings indicate a positive association between financial self-efficacy and both conservative online spending and financial planning, while financial response efficacy is strongly associated with financial planning but not with conservative online spending. These findings indicate that perceived personal vulnerability to war, rather than perceived threat severity or broader geopolitical instability, is associated with online consumption restraint in the present sample. Moreover, spending restraint is positively associated with perceived financial capability, while structured financial planning is more strongly associated with beliefs in the effectiveness of financial strategies. The study provides context-specific empirical evidence on the differential relevance of PMT components in a prolonged instability context, with vulnerability and severity, as well as the two coping-appraisal components, exhibiting different associations across behavioral outcomes. From a supplementary prospect-theory perspective, the observed association may be consistent with heightened sensitivity to potential financial losses; however, loss aversion was not directly measured. Practically, the results underscore the importance of reducing actual household financial vulnerability through financial safety nets, access to reliable financial information, emergency liquidity mechanisms, and financial literacy initiatives, while strengthening both financial capability and confidence in financial strategies in fragile, low-trust economies.