Is Religion An Essential Driver Of Economic Growth?
Peter Berger is perhaps the world’s most prominent living sociologist. He has written two dozen books including seminal texts in the development of the sociology of religion, the sociology of knowledge, and the sociology of modern development. He may be the most qualified person to speak with authority on matters pertaining to the relationship between religious beliefs and economic development, so I decided to ask him to explain this to me. This interview is the result, and it’s worth listening to in full. At age 84 Berger is still sharp as a tack and has a long lifetime of study and analysis behind him (and I expect quite a number ahead of him).
When I asked him what he has learned in a lifetime of studying these questions, he told me that there are certain social preconditions to economic development, and that the way a society operates is important in regards to how prosperous that society can become. This is largely a matter of culture, and for most of the world culture basically means religion. Religion drives culture; culture drives social forms; social forms drive development.
Regarding different religions and their level of conduciveness to growth, he said that they are not equally conducive. He pointed out the work of Max Weber, whose seminal work, The Protestant Ethic and the Spirit of Capitalism, argued that the lifestyle which arose from Protestantism played a decisive role in the creation of modern prosperity. For Weber, and Berger agrees, the Calvinistic lifestyle of worldly asceticism became a source of growth and capital accumulation. Worldly asceticism (Weber’s phrase) upheld the virtue of productive labor in this world, as opposed to an otherworldly orientation often associated with medieval Catholicism. The focus on this life as opposed to the afterlife tends to create large income streams. But worldly asceticism looks askance at lives of excessive spending and conspicuous consumption, which are often associated with wealth. The result is a well-educated, highly skilled diligent work force and large pools of capital. Without this, or something like it, modern capitalism would not have arisen as it did.
Not all religions, at least in the current form, have these same characteristics, therefore not all religions are equally conducive to development. Not surprisingly, Berger says he has been accused of racism or bias because of these views. But he points out that it’s not a matter of bias; it’s simply a matter of facing the facts.
According to him, this Protestant effect expressed itself in different ways in different times and places: historically in America in her Puritan heritage. Currently in the developing world, it reveals itself in the explosive growth of Evangelicalism which is helping to create modern developed economies. Perhaps Pentecostalism plays a role in the Third World similar to that played by Calvinism in Europe and North America, or at least is an important factor in the emergence of a middle class.
There is an important caveat in all this: Religions change over time and so it’s not helpful to do this sort of analysis in terms of the characteristics of a religion in general, but instead in a certain historical context. For example, Christianity in the Middle Ages may well have retarded economic progress through its embrace of usury laws (which I would argue it got from Aristotle rather than from Christ.)
Another caveat urges us to avoid confusing the effects of a religion on institutions with its effects on individuals. According to Berger, Confucianism preaches many of the virtues, such as education, hard work and delayed gratification, which are conducive to prosperity among individuals, but that Confucian disdain for commerce has tended to create societies which are more conducive to entrepreneurial stagnation. Therefore a Confucian China can stagnate for millennia. But when Chinese people migrate to more open societies in Southeast Asia, they become the wealthy ‘overseas Chinese,’ Jews of the East, prospering and helping to prosper the societies they live in, part of the vanguard of economic development. Groups like the overseas Chinese become easy scapegoats for demagogues.
Regarding Islam, Berger does not discount the possibility that it might be able to coexist with liberty and prosperity, but points out that historically the subservient role of women in Muslim nations is a source of economic drag. To isolate half of the talent of a population from productive activity is bad enough. But to add to that a pattern of leaving women uneducated makes things even worse because of the role that mothers play in the intellectual development of children. He points to Turkey as a beacon of hope. I am less optimistic than Berger about the much vaunted ‘Turkish model,’ but time will tell.
Islamic economics is a subject unto itself and deserves at least one future column of its own. But in case you’re not quite ready for that topic yet, I’d suggest that you listen to my interview with Peter Berger. Because when it comes to talking about religious differences, there is a policeman in your head who twirls his night stick every time you question the current dictates of our pervasive political correctness speech code, and Peter Berger might help you put that policeman into a helpful retirement.
Article originally published in Forbes.com.
Jerry Bowyer is a Forbes contributor, contributing editor of AffluentInvestor.com, and Senior Fellow in Business Economics at The Center for Cultural Leadership.
Jerry has compiled an impressive record as a leading thinker in finance and economics. He worked as an auditor and a tax consultant with Arthur Anderson, as Vice President of the Beechwood Company which is the family office associated with Federated Investors, and has consulted in various privatization efforts for Allegheny County, Pennsylvania. He founded the influential economic think tank, the Allegheny Institute, and has lectured extensively at universities, businesses and civic groups.
Jerry has been a member of three investment committees, among which is Benchmark Financial, Pittsburgh’s largest financial services firm. Jerry had been a regular commentator on Fox Business News and Fox News. He was formerly a CNBC Contributor, has guest-hosted “The Kudlow Report”, and has written for CNBC.com, National Review Online, and The Wall Street Journal, as well as many other publications. He is the author of The Bush Boom and more recently The Free Market Capitalist’s Survival Guide, published by HarperCollins. Jerry is the President of Bowyer Research.
Jerry consulted extensively with the Bush White House on matters pertaining to the recent economic crisis. He has been quoted in the New York Times, The Wall Street Journal, Forbes Magazine, The International Herald Tribune and various local newspapers. He has been a contributing editor of National Review Online, The New York Sun and Townhall Magazine. Jerry has hosted daily radio and TV programs and was one of the founding members of WQED’s On-Q Friday Roundtable. He has guest-hosted the Bill Bennett radio program as well as radio programs in Chicago, Dallas and Los Angeles.
Jerry is the former host of WorldView, a nationally syndicated Sunday-morning political talk show created on the model of Meet The Press. On WorldView, Jerry interviewed distinguished guests including the Vice President, Treasury Secretary, HUD Secretary, former Secretary of Sate Condoleezza Rice, former Presidential Advisor Carl Rove, former Attorney General Edwin Meese and publisher Steve Forbes.
Jerry has taught social ethics at Ottawa Theological Hall, public policy at Saint Vincent’s College, and guest lectured at Carnegie Mellon’s graduate Heinz School of Public Policy. In 1997 Jerry gave the commencement address at his alma mater, Robert Morris University. He was the youngest speaker in the history of the school, and the school received more requests for transcripts of Jerry’s speech than at any other time in its 120-year history.
Jerry lives in Pennsylvania with his wife, Susan, and the youngest three of their seven children.