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SECULARIZATION AND LONG‐RUN ECONOMIC GROWTH
Author(s) -
Strulik Holger
Publication year - 2016
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/ecin.12242
Subject(s) - secularization , economics , consumption (sociology) , appeal , neoclassical economics , pleasure , identity (music) , redistribution (election) , protestantism , extension (predicate logic) , multiplier (economics) , endogenous growth theory , conspicuous consumption , microeconomics , public economics , keynesian economics , sociology , market economy , political science , law , human capital , social science , computer science , institutional economics , psychology , physics , neuroscience , politics , acoustics , programming language
This paper integrates a simple theory of identity choice into a framework of endogenous economic growth to explain how secularization can be both cause and consequence of economic development. A secular identity allows an individual to derive more pleasure from consumption than religious individuals, leading secular individuals to work harder and to save more in order to experience this pleasure from consumption. These activities are conducive to economic growth. Higher income makes consumption more affordable and increases the appeal of a secular identity for the next generation. An extension of the basic model investigates the Protestant Reformation as an intermediate stage during the take‐off to growth. Another extension introduces intergenerationally dependent religious preferences and demonstrates how a social multiplier amplifies the speed of secularization. ( JEL N30, O10, O40, Z12, Z13)