Economics, Religion, Top Stories

Does Religion Impede Economic Development?

In the 500th anniversary of Martin Luther’s 95 theses that propelled the Protestant Reformation, it is timely to recall that the shockwaves were not just confined to Christian doctrinal matters but were central to the rise of industrial capitalism that transformed the whole world. This thesis was set out in the most famous link between religion/ethics and economic development by Max Weber in The Protestant Ethic and the Spirit of Capitalism, published in 1904. I should like to make the claim that it has relevance in the present day in regard to the development of the Global South. In the introductory chapter, Weber makes some forceful observations that are of considerable importance to the goal of global development: “Only in the West does science exist at a stage of development which we recognize today as valid … A rational chemistry has been absent from all areas of culture except the West … [A] rational, systematic, and specialized pursuit of science, with trained and specialized personnel, has only existed in the West in a sense at all approaching its present dominant place in our culture”

Why these advances took place in Western Europe is what Weber sought to explain and provides the foundational reason as to why capitalism – which so enormously developed productive capacities and capabilities and transformed the world at extraordinary speed – originated among Protestants in Western Europe: “business leaders and owners of capital, as well as the higher grades of skilled labour, and even more the higher technically and commercially trained personnel of modern enterprises, are overwhelmingly Protestant”.

Weber’s thesis was striking and compelling; the rise of capitalism was rooted in Protestant (especially Calvinist) ethics and attendant cultural dispositions that stressed the importance of hard work and wealth creation (for the glory of God) and thriftiness. It was this trinity of factors that fomented a new economic system characterised by accumulation of capital – rather than wasteful expenditure – that financed investment and further expansion of enterprises. Hence, the Protestant ethic engendered the ‘spirit of capitalism’.

Protestantism was a movement of protest against the Catholic Church and the severing of ties with its centralised, hierarchical institutions. Accordingly, primacy began to be accorded to the individual’s relationship with God without recourse to institutions and clergy and it is this that arguably nurtured individual economic and political freedoms. Nascent capitalist enterprises in an increasingly marketised economy originated in initiatives by such individuals; a capitalist class imbued with a Protestant ethic was thus born.

Might this foundational hypothesis of Weber’s provide helpful insights for the present-day developing world? That is to say, those countries and societies that are characterised by a Protestant-type culture offer a more conducive environment for economic development than those that are not. Consider the large tracts of the world where development has been stagnant or sluggish in the post-colonial era. Can we argue that they are characterised by ethics and norms that are decisively at variance with the Protestant work ethic? If so, might the culture and religion of such societies powerfully militate against such an ethic?

The Weberian thesis is that those religions and cultures (Catholicism and even more so, Hinduism, Buddhism, and Islam) that stress anti-materialism and ‘other-worldliness’ and focus on spiritualism, discourage entrepreneurship and wealth creation, act as a brake on economic development.

A reasonable riposte is that while the Protestant work ethic may well have been a decisive factor in the origins of capitalism in Western Europe that is of little relevance now. Other, non-Protestant societies have also attained high levels of economic development by acquiring requisite institutions and skills. This is indeed true but a rejoinder to this argument is that this has entailed the overcoming or even rejection of their non-productive legacies; in other words such countries and societies, and cultures therein, have markedly changed.

In an edited collection Culture Matters: How Values Shape Human Progress, Samuel Huntington makes a striking comparison between South Korea and Ghana: in the early 1960s both had very similar economies and comparable levels of GNP per capita. Thirty years later, South Korea had become the 14thlargest economy in the world with a powerful manufacturing base whereas Ghana had not undergone anything like such a transformation and, accordingly, its GNP per capita was one-fifteenth of South Korea’s. Huntington concludes that “South Koreans valued thrift, investment, hard work, education, organization, and discipline. Ghanaians had different values. In short, cultures count”.

Ronald Inglehart and Christian Wetzel show that the worldviews of people living in rich societies differ systematically from those of people living in low-income societies across a wide range of political, social, and religious norms. The differences run along two basic dimensions: “traditional versus secular-rational values and survival versus self-expression values. The shift from traditional to secular-rational values is linked to the shift from agrarian to industrial societies. Traditional societies emphasize religion, respect for and obedience to authority, and national pride. These characteristics change as societies become more secular and rational”.

The inference here is clear: economic and social development requires a move to more secular and rational values. The question naturally arises as to whether enlightened governments can speed up development by implementing political, social, and religious reforms so as to lessen the ‘drag effect’ of traditional values. And is it possible for high levels of development to proceed without the concomitant move away from traditional values?

International institutions such as the UN and World Bank have neglected to explore the link between religion and development. In stark contrast, W Arthur Lewis argued that some religious codes are more compatible with economic growth than others. If a religion lays stress upon material values, upon work, upon thrift and productive investment, upon honesty in commercial relations, upon experimentation and risk bearing, and upon equality of opportunity, it will be helpful to growth, whereas in so far as it is hostile to these things, it tends to inhibit growth. Given that throughout the world, above all in the Global South, religion is profoundly important to many aspects of society, and strongly moulds people’s lives, the prevalence and intensity of religious belief will, accordingly, have a great impact on the trajectory of society in terms of growth and development.

The decline of religion in modern societies is termed the ‘secularisation thesis’ where economic development and rising living standards lead to a fall in the adherence to religious beliefs and practices. Importantly, if attributes of a religion and attendant cultural norms affect the attitude towards work, saving, investment, propensity to innovate, that is, the workings of an economy, as posited by Weber, then the secularisation thesis argues that the resulting economic and social advancement has a feedback effect on religious belief, that is to say, reduces it. Where a religion militates strongly against rising productivity and innovation, it has a dampening effect on the economy so, in turn, reduces such a feedback on the belief system. This suggests a curious result: cultures and religions that most effectively protect themselves against economic advancement are best able to ensure that their hold on a population is little diluted.

In the absence of rigorous research on this issue, there is nevertheless good reason to think that both the levels of believing and belonging are significantly greater in the Global South than in the developed world. Moreover, the intensity of religious belief is also likely to be greater given its imposition from a very young age. That being so, and in the absence of a secular state, institutions, and laws, religion and its cultural accoutrements permeate every vestige of society and, by so doing, profoundly impact the determinants of development and growth. True, these are strong claims and generalisations but they are worthy of extensive investigation and empirical research – in particular by international development institutions, especially the World Bank and UNDP which have never done this.

 

Rumy Hasan is a senior lecturer at the University of Sussex and author of Religion and Development in the Global South (Palgrave Macmillan, 2017).

Filed under: Economics, Religion, Top Stories

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Rumy Hasan is the author of Multiculturalism: Some Inconvenient Truths (2010) and Religion and Development in the Global South (forthcoming 2017); and a member of the EU’s Radicalisation Awareness Network (RAN) with a special interest in the prevention of Islamic radicalisation.

21 Comments

  1. dirk says

    After 10 yrs work in Africa, I was amazed by the overwhelming influence of religion in personal life and communities, whereas in my home country, secularisation was spreading like a bushfire and churches became obsolete. However, this hausse in Africa was not at all accompanied by economic growth, not at all, no way, agriculture (30-60% of the people are farming) cannot even provide the most needed staples, without imports, people would starve.

  2. Robert Darby says

    Relevant to this discussion is a fascinating article in which Peter Jenkins contests the argument that Western science was a product of the Reformation and argues that the Scientific Revolution & modernity (and with it the Industrial Revolution) owe more to technology, commerce and property law than to religious change. He willingly admits that there is a connection between Protestantism and the scientific outlook (you have only to compare the rate of scientific progress in early modern Britain as compared with Spain or Italy), just as there is a connection between Protestantism and capitalism, as expounded by Max Weber. But in explaining the rise of science in Britain, Jenkins takes a materialist approach and looks “far less to ideas, religion, or intellectual history, and rather to social and economic realities, and especially to matters of law and custom.” To take a couple of examples, economic development required new technologies that in turn called forth deeper knowledge in areas such as metallurgy (better guns, furnaces) and mathematics (navigation, ballistics). Even more importantly, security of property gave owners the incentive to invest in long-term projects. English property law gave rights underground to the landowner, not (as in Europe) to the monarch, thus encouraging mineral exploration; and it ensured that all property was normally safe from seizure – unlike in much of the Islamic world, where fixed property (land, workshops) was at the mercy of the sultan or local ruler, and the wealthy thus tended to keep their wealth in moveable but unproductive forms, such as gold and jewellery. As Jenkins concludes, “in making the West, and Western science, mortgages and mineral rights matter at least as much as theology, Calvinist or otherwise.” So it may be that one of the most important factors was the English common law. Details at:

    http://www.patheos.com/blogs/anxiousbench/2017/10/reformation-science-modernity/

    • ga gamba says

      That’s an excellent read. Thanks for the link.

    • Peter L. says

      Thank you for this insightful comment. The influence of common law is a very interesting proposition regarding the advancement and development of societies.

  3. dirk says

    I fear, any attempts to make a sharp distinction in (seculary) custom, law and trade and enterprise habits and spirit from pure christian beliefs and conduct in (late) mediëval times are rather futile . Read Yuval Harari on these issues, very insightful chapters on (western) religion and prosperity.

  4. Spengler suggested it was an innate unruly Promethean spirit in north Europeans that drove on individuality, exploration etc in religion as well as commerce. (And monogamy and no cousin marriage.)
    I’d really like to know the long term effect of any ideology that suppresses individuality – presuming that this is under genetic influence. How do oppressed races / nations bounce back when liberated?

  5. ga gamba says

    I’d really like to know the long term effect of any ideology that suppresses individuality – presuming that this is under genetic influence. How do oppressed races / nations bounce back when liberated?

    I suspect colonialism underpins the question. We can look to S. Korea, Taiwan, Singapore, Hong Kong, and Malaysia to see how they’ve done. After China and India dispensed with the disastrous and oppressive policies of Maoism and the Licence Raj respectively, both have thrived. They likely would have enjoyed decades of prosperity much earlier had neither reactionary system been implemented.

    We ought not limit ourselves to this one particular period of world history, though. Did the Spanish not bounce back after almost eight centuries of oppression by the Moors? Did the Seven Provinces of the Low Countries not bounce back after overthrowing the Spanish? Have the Norwegians and Finns overcome their oppression by the Swedes?

    Is it any different for an Indian peasant to be oppressed by a Mughal (himself an invader) or the British East India Company? Was a Dalit more likely to be brutalised for casting a shadow by a higher caste Hindu or a colonial agent? If I were Han Chinese, would I prefer my city to taken by the British or the Manchus? For all their flaws, the British didn’t massacre about 800,000 people in 10 days like the Manchus did in Yangzhou. Do you think the San were overjoyed by the Bantu invasions of Southern Africa? “Hey, at least our conquerors are the same colour as us. What a relief!”

    Let’s not ignore that people belonging to the same ethnic group can be as brutal and murderous as outsiders. Yet, once the oppressor group/class/caste’s carte blanche was revoked the oppressed bounced back. People are resilient, and mollycoddling this group or tends to retard their progress by keeping them in a state of dependency.

    • Chris v1.0 says

      I was really thinking about intellectual oppression or suppression, specifically targeting individualism, by a totalitarian movement. This has been done in short bouts as with the maoists chopping off the blooming flowers, but maybe Islam created a long term general suppression, relentlessly squishing eg the neoplatonists out.

  6. Chris says

    Weber’s culture of the west idea still resonates with me, but the argumentation of protestant vs catholic culture and the resulting economic outcome is bogus. Just pick some other example: In Germany, Protestants and Catholics have lived in very geographically defined areas for centuries and the Catholic south has been significantly more prosperous for many many decades.
    Germany’s south is also more politically conservative in general. So, not withstanding the authors sentiment that doctrines impede economic and intellectual progress, but in today’s western culture it is not religion – widespread acceptance of (i.e. avoidance of conflict with) various far-left doctrines have the same backwards effect.

    • Chris says

      PS: When I say today’s western culture, I meant a few years ago, before the orchestrated replacement of secular societies with religiously indoctrinated fanatics has begun.
      But since that is an experiment of unprecedented scale it’s hard to make any predictions: I mean have we learnt anything from what happens to literally all indigenous populations when their land was settled by an aggressive invader who believed they are superior? However, since they are white, the inevitable is considered positive by the indoctrinated establishment. So what is next, are we going to do away with the humanity and it’s resulting proceedings like clinical trials (remember Thalidomide/Contergan?) as long as all the subjects are of a certain race (remember Josef Mengele?). Where will the witch hunt of identity politics stop?

  7. OleK says

    Another counter data point: modern Rus. Sure, there was a big technological jump during Communism and the Cold War, but what about since 1980 when the Russian Orthodox Church has seen a great resurgence? It seems to me that Russian (and the greater Rus) has caught up to the West pretty heavily due to a more Capitalistic economy (despite the authoritarian tendencies of the leader at whatever point in time during the past 30-40 years).

  8. dirk says

    Clear case of the large difference between natural science and humaniora such as sociology, psychology and history. In natural science we look for the cause and the strict quantitative law of a phenomenon(how many seconds does it take for a stone to fall before it reaches the ground). In sociology, such a strict causal relation does not exist, calvinism certainly had a role in the birth of capitalism (together, and contextual with other factors), but it was not a one-on-one , neither a quantitative relation.

  9. Bunny Whisperer says

    Among other impediments, religion has always relegated half of the human species (females) and its tremendous potential to the dust bin. In culture, arts, political offices, technical, mechanical and engineering, science, and especially religion women have been downgraded to servile roles, their original contributions acknowledged only posthumously, if at all.

    • Chris says

      You know the saying that behind every strong man there is an even stronger woman.
      While not being front and centre, women had always a major influence. This thesis is based on the assumption of a monogamous society (e.g. not the case in Islam) and that they raise their children (e.g. not the case in many socialist societies, where the state ‘takes care’ of things). If one needs more evidence, just look in which societies feminism found acceptance.

      On a different note, the question is why do women enjoy the “oppression of religion”? Go to church and you’ll see that the majority of people are women especially when it comes to the elderly (and that is not something recent).

      • What? Why are churches full of older women? Because they like being oppressed? I think it has to do with their husbands being dead and the like the reassurance of routine and familiarity. Christians anyway. I know little of Islam, but since their religious culture and their societal culture are one and the same it’s seems the oppression of women angle has merit. But who is the oppressor? I’ve come to understand that the forcing of burka’s and head to toe covering for women is actually imposed by mothers and older women to suppress the sexual power of young women – purely as a control tactic – designed to keep the men in line as much as anything.

  10. dirk says

    Women have had, all history long, since the stoneage and in some traits even before, a special role in household,field, animal care, hospital, education, politics (Empress Maria Theresia and others) etc etc. As a youngster of 6, I learned the church rituals from nuns, my education and etiquette from my mum (much less so from my father), how to kiss from a girlfriend, etc etc. Only the last 40 yrs, the scene changed completely, beyond any recognition, that is, of course, mostly in the western, non-muslim world. Ni modo, they say in Mexico. I live anyhow a quiet live. And never read La Deuxieme Sexe of Simone de Beauvoir, why should I??

  11. dirk says

    Sorry, I made a mistake, it is Le deuxieme sexe, so even that is masculine!! Oh,oh, where does this end!

  12. George Kushner says

    Unquestioned link between economic growth and human prosperity in large looks dubious.
    Once the most basic human needs for food and shelter are satisfied ( which certainly require some sort of economic development ) the positive impact of further capitalist enterprise seems questionable. Environment degradation, physical and social addictions and general lack of purpose and meaning in culture seem more immediate and tangible results of capitalist success than flourishing of arts or exploration of cosmos or whatever deemed to be worthwhile human endeavors

  13. Pingback: Religion and development – Siya Aggrey

  14. Christopher A Rivera says

    Alex Kierkegaard: 676. A great mistake the anti-religious fanatics make is lumping all religions together under the label of “religion” as if they were equal. But Nietzsche has clearly explained that Christianity stands lower than Buddhism, and Buddhism stands lower than the pagan religions of the various nations — and especially those of classical antiquity — which themselves stand lower then the religion of the future: philosophy/Overman worship. So… if by “the comeback of religion”, which, it is now dawning on some, may now be under way, they mean “the comeback of faith” — after the temporary reduction in our estimation of the value of faith caused by the Enlightenment and the scientific revolution — they are correct. But the faith that will dominate and shape the future is no longer the faith in external gods, but in the gods within us.

    813. Once more on Leibniz vs. Newton. Leibniz’s God is supremely rational, but Newton’s is the common Christian God whose will is “unknowable”, and that’s why on all the deepest issues Newton has nothing to say, but simply attributes them all to “God” — i.e. to his own ignorance.
    Lichtenberg: “Are all our conceptions of God, after all, anything more than personified incomprehensibility?”
    So, for Lichtenberg, God is a catch-all term for everything one doesn’t understand. So the more one comes to understand, the smaller this sphere becomes — and therefore this God — while at the same time the ego grows at the exact same rate, and begins to demand “its own” (Stirner). Finally, right past the tipping point, where the amount of one’s insight surpasses the amount of one’s ignorance, calling the ignorance “God” ceases to make much sense, and using it for the insight instead — i.e. for the ego, for oneself — is the only logical thing to do. And that’s how the God concept shifts from designating “personified incomprehensibility” to personified comprehensibility, and God transforms from a “holy” ghost and spirit… to flesh and blood (and metal, and circuits): to an “evil” man and superman; to me and my descendants.

    56. Linguistic optics: the time for it has come. The idea is basically that no one (and nothing) is “wrong”; they can’t be wrong because they are part of the universe, and whatever is in their brains — in the brains of even the stupidest person — is as “correct” as what’s in my mind or Nietzsche’s or Baudrillard’s. What we need then is an art of interpretation so subtle and powerful that it can bring out the “truth” that’s hiding inside even the dumbest person’s brains.
    For example, when a Christian says “God created the universe and he loves me”, he is not wrong. It’s just that the concepts he designates with the words “God”, “universe” and “love” are different from the concepts someone smart and educated, like me for instance, designates. For me the word “God”, going by the Christian’s definition of omnipotence, omniscience, perfect goodness, etc., is an empty word, a non-concept, since the predicates the Christian attaches to it are incommensurate with each other. But when the Christian says “God”, he doesn’t really mean an “omnipotent, omniscient, perfectly good being” (since he’s so dumb he can’t even grasp what these concepts mean, and hence uses them in ape-like and parrot-like fashion); he simply means “a very powerful being”. Similarly, when he says “universe” he doesn’t mean what I mean by “universe” (i.e. “everything”), he simply means “the earth” — or at most, if he’s had a whiff of astronomy, perhaps “the solar system”. And finally, when he says “love” he doesn’t mean what I mean by “love” (i.e. a desire for possession, in order to shape the thing possessed), but the exact opposite, i.e. “help me” (= shape me).
    So basically, when the Christian says “God created the universe and he loves me”, what he’s really saying, translated in our language, is “A very powerful being created the earth (or the solar system), and he wants to help me” — which could very well be true!
    All of this stems from Nietzsche’s positive theory of language, which basically says that a word means WHAT THE SPEAKER WANTS IT TO MEAN, and has no necessary connection to any pre-existing convention between speaker and listener. Ultimately, each person gives his own meaning to every word, which is only natural since this meaning is to be found inside each person’s brain, and all brains are different.

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