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Club Goods and Group Identity: Evidence from Islamic Resurgence during the Indonesian Financial Crisis

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  • Daniel L. Chen

Abstract

This paper tests a model in which group identity in the form of religious intensity functions as ex post insurance. I exploit relative price shocks induced by the Indonesian financial crisis to demonstrate a causal relationship between economic distress and religious intensity (Koran study and Islamic school attendance) that is weaker for other forms of group identity. Consistent with ex post insurance, credit availability reduces the effect of economic distress on religious intensity, religious intensity alleviates credit constraints, and religious institutions smooth consumption shocks across households and within households, particularly for those who were less religious before the crisis. (c) 2010 by The University of Chicago. All rights reserved..

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Bibliographic Info

Article provided by University of Chicago Press in its journal Journal of Political Economy.

Volume (Year): 118 (2010)
Issue (Month): 2 (04)
Pages: 300-354

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Handle: RePEc:ucp:jpolec:v:118:y:2010:i:2:p:300-354

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Web page: http://www.journals.uchicago.edu/JPE/

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Cited by:
  1. Christophe Muller & Marc Vothknecht, 2011. "Group Violence, Ethnic Diversity, and Citizen Participation: Evidence from Indonesia," Research Working Papers 48, MICROCON - A Micro Level Analysis of Violent Conflict.
  2. Björn Frank, 2011. "Economic page turners," MAGKS Papers on Economics 201126, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
  3. De Hoop, Thomas & Van Kempen, Luuk & Linssen, Rik & Van Eerdewijk, Anouka, 2010. "Women's Autonomy and Subjective Well-Being in India: How Village Norms Shape the Impact of Self-Help Groups," MPRA Paper 25921, University Library of Munich, Germany.
  4. Thomas Buser, 2014. "The Effect of Income on Religiousness," CESifo Working Paper Series 4801, CESifo Group Munich.
  5. André, Pierre & Demonsant, Jean-Luc, 2013. "Koranic Schools in Senegal : A real barrier to formal education?," MPRA Paper 53997, University Library of Munich, Germany.
  6. Gordon H. Hanson & Chong Xiang, 2011. "Exporting Christianity: Governance and Doctrine in the Globalization of US Denominations," NBER Working Papers 16964, National Bureau of Economic Research, Inc.
  7. Gilat Levy & Ronny Razin, 2012. "Religious Beliefs, Religious Participation, and Cooperation," American Economic Journal: Microeconomics, American Economic Association, vol. 4(3), pages 121-51, August.

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