New Papers on the Economic Analysis of Religion

26 December 2007 at 1:19 pm 3 comments

| Peter Klein |

The economic analysis of religion is a rapidly growing area of applied microeconomics. To some, it represents creative and clever applications of economic theory to social, cultural, and institutional phenomena. Others see it as a crude form of economic imperialism. Only economists could take the spirit out of spirituality!

The October 2007 issue of the American Journal of Economics and Sociology contains some examples of this genre:

John H. Beck, “The Pelagian Controversy: An Economic Analysis.” The present study analyzes the decision of church authorities in the early fifth century to reject the doctrine advanced by Pelagius in favor of the position taken by Augustine. Accounts of the controversy reveal two self-interested motives for the church hierarchy to reject the Pelagian doctrine: (1) the Pelagian view would have undermined the authority of the church hierarchy; and (2) by making greater demands for moral conduct, it would have raised the “cost” of being a Christian and thereby discouraged growth in church membership, particularly among the Roman upper class.

Russell James and Deanna Sharpe, “The ‘Sect Effect’ in Charitable Giving: Distinctive Realities of Exclusively Religious Charitable Givers.” An examination of the charitable giving behavior of 16,442 households reveals intriguing patterns consistent with the club-theoretic approach to religious sect affiliation.

Charles Zech, “The Agency Relationship in Churches: An Empirical Analysis.” Using data from nine denominations, this study finds strong evidence that pastor compensation is not tied directly to performance, but rather indirectly through promotion tournaments. Successful pastors are rewarded by being called to larger, presumably wealthier and more prestigious, congregations. Since it is so difficult to observe and measure a pastor’s performance in specific activities, churches differentiate good pastors from mediocre ones by considering their total performance, rather than any specific activities.

Michelle Trawick and Stephen Lile, “Religious Market Competition and Clergy Salary: Evidence from SBC Congregations in the South.” Using regression analysis, we conclude that greater concentration among Southern Baptist Churches’ members within a given county area has a positive, and statistically significant, impact on Southern Baptist clergy salaries, while greater concentration among other denominations has no impact on Southern Baptist clergy salaries. Most importantly, we show that Southern Baptist Churches exhibit predictable economic behavior despite the ethereal nature of the product they provide.

Entry filed under: - Klein -, Institutions.

Christmas Classics Open Source and Spontaneous Order

3 Comments Add your own

  • 1. Rafe Champion  |  26 December 2007 at 4:10 pm

    Well it is all about forming preferences isn’t it? In the economic marketplace we form preferences for investment and consumption, and maybe above all, the investment of time. In other markets we form preferences regarding beauty, brains, offensive and defensive skills, pain and pleasure. Recall that Mises always had an eye on the bigger picture, with economics being a part of bigger discipline that he first called sociology, and later praxeology.

  • 2. Economic Religion Geekery at The New Atheist  |  26 December 2007 at 9:30 pm

    […] a bit of an econ geek in addition to a general science geek, one of my favorite econ blogs, Organizations and Markets has a post on a few papers applying economic analysis to aspects of religion. Some very interesting […]

  • 3. michael webster  |  28 December 2007 at 11:59 am

    Steven J. Brams has a text on Game Theory and the Hebrew Bible.

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