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Protestantism and Government Spending: a Negative Relationship? An Empirical Application to Swiss Cantons

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Recent empirical growth literature suggests that cultural factors play a decisive role in economic development, while empirical evidence for their impact on government activity remains scant. In this paper, we conjecture based on Weber’s Protestant Ethics that ‚Protestant values’ such as self-reliance and austerity should affect both the size and scope of governments. More specifically, we hypothesize that smaller government budgets should be observable in more Protestant jurisdictions. Using a panel of sub-federal expenditure in 26 Swiss cantons from 1980 to 1998 we find supporting evidence, observing that the share of Protestants in the cantonal residential population exerts a spending dampening impact. Our results suggest that cultural factors should not be omitted from future public finance analyses.

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  • Fischer, Justina AV & Schneider, Friedrich, 2007. "Protestantism and Government Spending: a Negative Relationship? An Empirical Application to Swiss Cantons," SSE/EFI Working Paper Series in Economics and Finance 685, Stockholm School of Economics.
    • Handle: RePEc:hhs:hastef:0685
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    Cited by:

    1. Justina AV Fischer & Antonio Rodriguez-Andr�s, 2008. "Political institutions and suicide: A regional analysis of Switzerland," TWI Research Paper Series 33, Thurgauer Wirtschaftsinstitut, Universität Konstanz.
    2. Rosemary Ann Frey & Lawrence Alfred Powell, 2009. "Protestant Work Ethic Endorsement and Social Justice Values in Developing and Developed Societies," Psychology and Developing Societies, , vol. 21(1), pages 51-77, January.
    3. Martin Baur & Pierre-Alain Bruchez & Barbara Schlaffer, 2013. "Institutions for Crisis Prevention: the Case of Switzerland," Global Policy, London School of Economics and Political Science, vol. 4, pages 10-21, July.

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    More about this item

    Keywords

    Protestantism; Culture; Government Spending; Public Finance;
    All these keywords.

    JEL classification:

    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • Z10 - Other Special Topics - - Cultural Economics - - - General

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