Researchers at the Loma Linda University wanted to find out if laughter altered its effects.
Dr Lee Berk, who also worked on the study, said: "It's simple, the less stress you have the better your memory.
"Humour reduces detrimental stress hormones like cortisol that decrease memory hippocampal neurons, lowers your blood pressure, and increases blood flow and your mood state.
"The act of laughter -- or simply enjoying some humour -- increases the release of endorphins and dopamine in the brain, which provides a sense of pleasure and reward."
Gurinder Singh, who led the study, showed a 20-minute laugh-inducing funny video to a group of healthy elderly individuals and a group of elderly people with diabetes.
The groups where then asked to complete a memory assessment that measured their learning, recall, and sight recognition.
Their performance was compared to a control group of elderly people who also completed the memory assessment, but were not shown a funny video.
The research team found a significant decrease in cortisol concentrations among both groups who watched the video.
“Our research findings offer potential clinical and rehabilitative benefits that can be applied to wellness programmes for the elderly," Dr Bains said.
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