Tuesday, March 10, 2020

The Economic History of Religion

Book cover that includes partial blue sky covered by brown leaves
In the book The Wealth of Religions: The Political Economy of Believing and Belonging by Rachel M. McCleary and Robert J. Barro, religion is viewed and defined not as a philosophical system of faith and worship but rather as a historical entity with economic ties and connections to respective countries and regions. Religion has certainly played a significant and vital role in history and has had far-reaching consequences on politics, ideology and the economy, and it continues to influence our mindset, our way of thinking and interpreting the world.

This perception is certainly not new, and it has been discussed to some extent in Max Weber’s influential and ground-breaking book The Protestant Ethic and the Spirit of Capitalism, but it is both helpful and useful to gain a better, wider and more through understanding of religious beliefs as well as how and why they shape and impact world economies as well as current political realities. 

The outcome of this analysis is the inherent hope to overcome enmity and intolerance by focusing on more thorough and less biased knowledge and information while at the same time attain a clearer and more balanced perspective and understanding of the past.

Essentially religion, not unlike science or philosophy, attempts to make sense of the world, yet its focus is less on material aspects but rather on the unseen spiritual world connected to questions of meaning, existence, and death. 

Religion may be better suited for certain questions than others. When it comes to assumptions about the physical world, such as the age and shape of our planet, one ought to naturally turn to science for answers, but other areas that pertain to subjective as opposed to objective issues or phenomena, such as the existence of an afterlife or of spiritual entities are – at least under current standards and methods - outside of the scientific realm and inquiry, and hence, religion could help to fill in the blanks or connect the dots.

However, the history as well as the economics of religion are less interested in the truth or validity of religious concepts, doctrines or dogma, but religion is treated in an objective manner by examining and analyzing its effects and repercussions on other fields and areas, such as its evolution, influences, and development of and by economic, political, and social forces.

Previously, I discussed economist Iannaccone’s analysis of religious movements, particularly radical sects and cults and its relation to the economic club membership model. In a cost and benefit analysis, religion is deemed as valuable in terms of its products and services – the benefits - it can provide to its adherents minus the sacrifices – or costs – this may entail.

One’s choice of and identification with a certain religion would often be influenced and set in terms of overall fears and beliefs of the times. For instance, in the 50s and 60s, there was a growing movement towards rejection or revision of established norms and lifestyles; that could range from the hippie movement with its re-definition of moral and sexual values and fashion to a growing attraction for unorthodox movements and cults, whether it was Jim Jones’s Peoples Temple, Hindu ashrams with Indian gurus, or even membership within the Charles Manson cult. In modern times, discontent and instability has led to the practice and formation of Islamic or far-right terrorism with each feeding, preying and playing upon its members’ anxieties.

In each of the cases, people identify with and embrace services that these movements and religions offer them. In other words, people become consumers of a brand that personally appeals to them, and it may be part of a trend, a by-product or a paradigm of the times, but it is almost always driven and fueled by strong emotions. 

In fact, the more extreme the thoughts, ideas, and actions, the stronger and more daring one’s personal identification with a given marginal group will be, and it will be harder to wean them off from the movement in question or to change their mindset about the group’s actions and practices, no matter how immoral they are or seem to others.

Due to the high cost of associating with aggressive or unorthodox marginal groups, many will turn away and be turned off by them, but a minority will find it even more appealing and will embrace it ever more tightly. In each of these groups, whether it is Osho’s ashram of Rajneeshpuram as depicted in the documentary Wild Wild Country or the way the Manson family dressed and talked, they not only tend to physically and often mentally separate themselves from mainstream communities, they also tend to stand out more distinctly in their habits and customs and establish a closer bond with their fellow members even at the expense of immoral deeds and crime. 

In fact, the acceptance of their fellow members becomes more vital to them than that of other peers, friends or family members, hence turning them into more deeply entrenched members and followers of a given cult or sect.

For our purposes here, I would like to focus on two important aspects that both influenced religion and the economy both in direct and indirect ways, namely interest and property rights as well as literacy and individuality.

Interest and Property Rights

One of the most puzzling aspects of the history of religion has been regarding the matter of Islamic civilization. During the Middle Ages, while the West was shrouded in what is known as the dark ages of history and civilization, especially in relation to science and knowledge, Islam was thriving and flourishing in science. How and why was it that their advancement came to a halt with the West overtaking Muslim countries in terms of economic wealth and development after the Renaissance and more visibly during the Industrial Revolution?

Among the simplest answers to explain Islamic economic stagnation and decline relative to Christian countries was the issue regarding interest and property rights. Interest is a necessity when dealing with commercial and financial transactions, and it is often regulated and controlled by authorities. 

In the West, during Calvin’s lifetime, one was allowed to charge up to five percent interest, which was later, after his death in 1564, raised to ten percent by the Genevan government; anything above that amount was considered excessive and designated as usury and could be banned and punished by the Consistory. As a standard of comparison, credit cards nowadays may charge up to twenty percent, which shows how companies have been given relatively free reign in modern capitalist markets. 

Yet it was from the eleventh to the sixteenth century that Muslim regions excelled in scientific discovery and military prowess. This demonstrates that inherently Islam is not incompatible with nor opposed to advances in the pursuit of knowledge and science. The golden age of Islamic cultures was around the 11th century during which Muslim scholars referred to, worked with and built upon discoveries of the Greek and Latin texts, especially when it came to the fields of medicine, mathematics, astronomy, and optics.

Nonetheless, the scientific production in Muslim countries came to a standstill partly due to the growth of religious elites that aimed to suppress independent thinking and judgment. In fact, schools shifted away from fostering critical thinking to embracing more passive and less innovative forms of knowledge, such as rote learning and memorization.

As a result, investigation and innovation were hampered as these new measures and methods stifled and stunted curiosity and research. This led to an intellectually rigid system that depended upon given and ready-made interpretations and that underscored the importance of obeying and submitting to the religious authorities. Disobedience in any form and whether justified or not was not only frowned upon but forbidden and prohibited and interpreted as a sinful act of aggression against the divine as well as an attack on universal social harmony.

In contrast, Western Europe was more conducive to the rise of capitalism since individualism was valued and promoted; that led not only to diversification and expansion of knowledge, research, and mass communication but also to a legal system that tended to reflect and inscribe those values, all of which were supported, fostered and propelled by the invention of the printing press.

These movements also had serious repercussions in terms of corporate law and governance. Muslim countries had declined economically since the Industrial Revolution because they were set back by rules and restrictions of inheritance, credit and insurance markets, and contract enforcement, and these regulations would restrain markets and hinder economic growth and development.

In Western Europe, however, legal systems were put in place that allowed and gave room for contracts, the enforcement of contract provisions, and property rights alongside a general absence of restrictions vis-à-vis credit and insurance. Interest within reasonable sets and parameters were not prohibited neither by law nor by the Scriptures, and it was only its more excessive from as usury that was discouraged.

All in all, this created an environment that helped businesses grow and flourish. As such, modern corporations can be considered a Western European concept and invention. In fact, corporations were not recognized in Islam, at least not until 1908. While non-Muslims were permitted to form corporations, this was only allowed under the legal systems of their own country abroad, which led to corporations that were then headquartered in Paris or London and not on Islamic lands.

As Christians and Jews were exempt from stifling local laws, they tended to outperform their Muslim counterparts in those Islamic countries. Since followers of other religions ended up gaining wealth and prosperity on Muslim soil, this was fodder for an underlying resentment against those groups and religions, which may, at least in part, explain why anti-Christian and antisemitic sentiments and movements tended to arise and expand in those given areas.

Moreover, unlike Islam, in Western societies even religion was not immune to social, political and legal changes and challenges; in fact, reforms and revolutions were to occur as a result of them. One notable case of rebellion came during the Reformation in which Martin Luther dissented and disagreed with established doctrine and dogma, and this gave way to the Protestant movement.

Literacy and Individuality

­­While the Catholic church insisted that ultimate authority was and would reside with the Church and its priests, with its highest representative the Pope considered and revered as God’s personal ambassador, Martin Luther would reject those views. In that sense, the Protestant movement was an act of rebellion that led to greater expressions of liberty as well as more freedom and flexibility.

The Protestants encouraged literacy since they wanted each, both male and female adherents to read the Holy Scriptures for themselves and to reach their own conclusions and interpretations; as such, schools were not only established but they were viewed and deemed as compulsory starting from a young age. 

In addition, the relationship with God shifted from the confines and premises of the church - both as a place of worship as well as an institution that would convey, transmit and often filter information - and gave way to a more personal relationship with God and His word via the Bible, which was then written and available in the vernacular and studied not only during service but also at schools and at the comfort of one's home. 

Moreover, Protestant beliefs also fostered traits like work ethic, honesty and thrift, which contributed greatly to the growth of economic prosperity during and after the Industrial Revolution. Protestantism also provided and extolled moral discipline and a psychological compulsion to work hard. In fact, individual intention and responsibility more than good works, compliance and charity, stood at the forefront and core of this religious belief system. Put differently, one was personally accountable not only for one’s actions to oneself and society but to God as well.

While economic failure could be viewed as not fulfilling one’s obligations as devotedly as possible, success and prosperity were considered a sign and blessing from God and fostered the belief that one was chosen and elected by divine providence and would be able to attain salvation in the afterlife. 

This devotion to making money through one’s “calling” - a divine ordinance from God regarding a person’s obligations in the material world - alongside fulfilling one’s vocation would later become more secularized and would be viewed as distinct and independent from religious beliefs and doctrine.

Interestingly, the compulsion to work has rested with us since then. This may come from an inherent aversion to idleness and of being viewed as lazy and unproductive. During Calvin’s times, this was a form of sin because when one was not busy, one had a higher risk of succumbing to temptations, bodily urges and physical pleasures. 

But by constantly working and being on the run, those sins could be left at bay. We have currently swallowed and ingrained those values by stating to ourselves both consciously and unconsciously that time is money and that more time could be spent making more money at the expense of a more balanced and satisfying life.

As a result, we tend to engage in overwork and try to amass more wealth than is necessary for a healthy life. At the same time, we often look down on those who are destitute, poor and living in poverty as we assume that it is due to their personal failings and shortcomings that they are and keep remaining in such a deplorable state. 

However, an analysis of the historical past and a better understanding of religion and its ties with social, political and more specifically economic structures can indeed be helpful to expose those underlying currents, beliefs and misperceptions that may have risen and accumulated over time. 

No comments: