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The Macroeconomics of Pascal’s Wager

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  • Paul Shea

    (Bates College)

Abstract

This paper explores the determinants of religiosity in a growth model. Religion reduces the time available for labor and the perceived likelihood of hell. A genetic algorithm selects agents’ discount factors based on their parents’ wealth. A higher discount factor increases savings, encouraging wealth accumulation, but also increases the discounted disutility of eternal damnation, incentivizing religion. The model converges to intermediate levels of the discount factor and religion where wealth is maximized. The genetic process selects agents’ level of patience, and the impact on religion is a side effect. Religion thus exists in equilibrium, even if it reduces genetic fitness.

Suggested Citation

  • Paul Shea, 2019. "The Macroeconomics of Pascal’s Wager," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 45(4), pages 481-496, October.
    • Handle: RePEc:pal:easeco:v:45:y:2019:i:4:d:10.1057_s41302-019-00143-6
    DOI: 10.1057/s41302-019-00143-6
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    More about this item

    Keywords

    Religion; Genetic algorithm; Learning;
    All these keywords.

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E37 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Forecasting and Simulation: Models and Applications

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