The effect of individuation on aggression is the same as its effect on social loafing. Individuation increases both aggression and social loafing.
In order to understand why this is, let us look at what all of these three things are. Social loafing is a phenomenon in which people who are in groups do not work as hard as they would if they were alone. Aggression, of course, is when people commit actions that are meant to harm or destroy others. Deindividuation is when people stop feeling as much self-restraint as they usually do. They are also less aware of themselves. Now that we understand what all of these three phenomena are, we can see why deindividuation will increase both aggression and social loafing.
When a person is deindividuated, they are no longer as aware of themselves. To some degree, they merge into the group and do not see themselves as individuals to the same extent that they otherwise would. When people lose sight of their individuality, they stop feeling as responsible as usual. When this happens, they can react in a number of ways. One way is through aggression. If you do not feel responsible for yourself, you are more likely to act aggressively. You do not feel the usual fear of acting in ways that society does not approve of. The same thing happens with social loafing. When you lose your sense of self, you do not care if people think well of you. Therefore, you do not care if loaf and people feel that you are lazy.
Because of these factors, deindividuation increases both aggression and social loafing. In both cases, people start to act in ways that are not socially acceptable because they do not feel as much of a sense of self or of personal responsibility.