October 21, 2010


Satan, the great motivator: The curious economic effects of religion (Michael Fitzgerald, November 15, 2009, bOSTON gLOBE)

What makes economies grow? It’s a question that has occupied thinkers for centuries. Most of us would tick off things like education levels, openness to trade, natural resources, and political systems.

Here’s one you might not have considered: hell.

A pair of Harvard researchers recently examined 40 years of data from dozens of countries, trying to sort out the economic impact of religious beliefs or practices. They found that religion has a measurable effect on developing economies - and the most powerful influence relates to how strongly people believe in hell. [...]

[O]ver the last several decades, better sets of statistics on religion have become available, and improvements in computing power and mathematical techniques have made it easier for economists to run very large statistical analyses, with hundreds of variables.

Among the most provocative findings have come from Robert Barro, a renowned economist at Harvard, and his wife, Rachel McCleary, a researcher at Harvard’s Taubman Center. McCleary, the daughter of a Methodist missionary, felt that she had seen religion change people’s economic behavior, and wondered why economists didn’t look at it as a potential factor in economic development. Barro found the idea intriguing.

The two collected data from 59 countries where a majority of the population followed one of the four major religions, Christianity, Islam, Hinduism, or Buddhism. They ran this data - which covered slices of years from 1981 to 2000, measuring things like levels of belief in God, afterlife beliefs, and worship attendance - through statistical models. Their results show a strong correlation between economic growth and certain shifts in beliefs, though only in developing countries. Most strikingly, if belief in hell jumps up sharply while actual church attendance stays flat, it correlates with economic growth. Belief in heaven also has a similar effect, though less pronounced. Mere belief in God has no effect one way or the other. Meanwhile, if church attendance actually rises, it slows growth in developing economies.

McCleary says this makes sense from a strictly economic standpoint - as economies develop and people can earn more money, their time becomes more valuable. For economic growth, she says, “What you want is to have people have their children grow up in a faith, but then they should become productive members of society. They shouldn’t be spending all their time in religious services.”

After Barro and McCleary’s initial work was published in 2003, other economists started looking more seriously at the impact of religious beliefs. Researchers based at the New University of Lisbon and the University of Illinois used a model that showed European industrial development between 1645 and 1850 took place roughly 35 years earlier in Protestant countries than Catholic ones. (The researchers posited that Protestant beliefs in economic success as a sign one might get to heaven inspired people to work harder and invest.) The German economist Sascha O. Becker looked at Prussia’s economic development and found that, at least for Germany, Weber was right about the Protestant work ethic: Protestants were more likely to be entrepreneurs than Catholics, and more likely to create bigger firms. (Becker argues the cause isn’t religious belief itself, but an accidental offshoot of Protestants needing to be literate enough to read the Bible.)

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Posted by Orrin Judd at October 21, 2010 5:55 AM
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