In: Economics
Let us look at the two-way causation and, thereby, the relationship between religion and development. First, how does a nation’s economic and political development affect its level of religiosity? When we look at the effects of economic development on religion, we find that overall development — represented by per capita Gross Domestic Product (gdp) — tends to reduce religiosity. The empirical evidence supports, to a degree, the secularization thesis which holds that with increased income, people tend to become less religious (as measured by religious attendance and religious beliefs). Economic development causes religion to play a lesser role in the political process and in policymaking, in the legal process, as well as in social arrangements (marriages, friendships, colleagues). There are four primary indicators of the influence of economic development on religion. Economic development implies a rising opportunity cost of participating in religious services and prayer. The more educated a person is, the more likely he is to turn to science for explanations of natural phenomena, with religion intended to explain supernatural phenomena and psychological phenomena for which there is no rational explanation. According to this view, the higher the levels of educational attainment, the less religious people will be (negative effect). On the other hand, an increase in education will also spur participation in religious activities, because educated people tend to appreciate social networks and other forms of social capital. Education increases the returns from networks and networking. On this view, religion is just another type of social capital (positive effect). Thus, we cannot conclude that richer societies are less religious because people are better educated. With people living longer, participation in certain religions will be low and then rise as the population ages. We find that, for a given level of religious participation, increases in core religious beliefs — notably belief in hell, heaven, and an afterlife — tend to increase economic growth. Religious beliefs raise productivity by fostering individual traits such as honesty, work ethic, and thrift. In contrast, for given religious beliefs, increases in church attendance tend to reduce economic growth. We think that this negative effect reflects the time and resources used by the religion sector as well as adverse effects from organized religion on economic regulation. When we look at the effects of religion on economic development, we find that attending religious activities on a monthly basis has a statistically negative effect on economic growth. We also find, according to the World Values Survey, that belief in hell is strong, with belief in heaven weaker. When looking at countries, measuring monthly attendance and belief in hell, we find that, for given levels of religious beliefs, notably in hell, heaven, and an afterlife, the effect of greater religious participation is to reduce economic growth.
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