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Holy cows and spilled milk: The impact of religious missions on firm-level productivity

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  • Bentzen, Jeanet Sinding
  • Boberg-Fazlic, Nina
  • Sharp, Paul
  • Skovsgaard, Christian Volmar
  • Vedel, Christian

Abstract

Did religious missions influence firm-level productivity? This study examines the impact of the Inner Mission (IM) movement on productivity in early twentieth-century Denmark, a predominantly Protestant and homogeneous society undergoing rapid industrialization. Using data on 964 creameries and employing an instrumental variables approach, we provide evidence that IM intensity reduced productivity in butter production, measured by the Milk-to-Butter ratio. The main mechanisms were Sunday closures, which disrupted economies of scale, and the fragmentation of creameries due to doctrinal disagreements among farmers. These disruptions prevented creameries from operating efficiently and reduced their profitability. Our results show how religiosity shaped patterns of modernization and industrial development absent the usual colonial or missionary confounders. This historical case speaks to debates in development economics about how informal institutions and moral regulation can constrain firm behavior and productivity.

Suggested Citation

  • Bentzen, Jeanet Sinding & Boberg-Fazlic, Nina & Sharp, Paul & Skovsgaard, Christian Volmar & Vedel, Christian, 2026. "Holy cows and spilled milk: The impact of religious missions on firm-level productivity," Journal of Development Economics, Elsevier, vol. 179(C).
    • Handle: RePEc:eee:deveco:v:179:y:2026:i:c:s0304387825002020
    DOI: 10.1016/j.jdeveco.2025.103651
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    Keywords

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    JEL classification:

    • N33 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: Pre-1913
    • N34 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: 1913-
    • Z12 - Other Special Topics - - Cultural Economics - - - Religion
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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