Households, particularly in the developing world, are prone to idiosyncratic and covariate
shocks. While the idiosyncratic shocks can be mitigated relatively easily, the highly
correlated risks associated with covariate shocks are difficult to insure. Besides the direct
cost due to loss of human lives and damage to physical property, there is indirect cost
associated with these occurrences that can have long-term welfare effects. These include
effects on children because of prenatal and childhood exposure, and the impact on adults’
risk and social behavior and mental health. Conflict shock is one such event that has been
found to have these effects. While the literature focuses on the effects of civil wars and
genocides, the impacts of criminal violence and terrorist incidents, two distinct but more
prevalent types of organized crimes, are highly understudied. Moreover, the examination
of prenatal exposure to an interplay between natural calamities and violent conflicts is
essential to advance our knowledge about the adverse influences of natural disasters in
the already fragile regions.