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Religious Market Structure, Religious Participation, and Outcomes: Is Religion Good for You?


  • Jonathan Gruber


Religion plays an important role in the lives of many Americans, but there is relatively little study by economists of the implications of religiosity for economic outcomes. This likely reflects the enormous difficulty inherent in separating the causal effects of religiosity from other factors that are correlated with outcomes. In this paper, I propose a potential solution to this long standing problem, by noting that a major determinant of religious participation is religious market density, or the share of the population in an area which is of an individual's religion. I make use of the fact that exogenous predictions of market density can be formed based on area ancestral mix. That is, I relate religious participation and economic outcomes to the correlation of the religious preference of one's own heritage with the religious preference of other heritages that share one's area. I use the General Social Survey (GSS) to model the impact of market density on church attendance, and micro-data from the 1990 Census to model the impact on economic outcomes. I find that a higher market density leads to a significantly increased level of religious participation, and as well to better outcomes according to several key economic indicators: higher levels of education and income, lower levels of welfare receipt and disability, higher levels of marriage, and lower levels of divorce.

Suggested Citation

  • Jonathan Gruber, 2005. "Religious Market Structure, Religious Participation, and Outcomes: Is Religion Good for You?," NBER Working Papers 11377, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:11377
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    References listed on IDEAS

    1. Iannaccone, Laurence R & Finke, Roger & Stark, Rodney, 1997. "Deregulating Religion: The Economics of Church and State," Economic Inquiry, Western Economic Association International, vol. 35(2), pages 350-364, April.
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    3. Joseph G. Altonji & Todd E. Elder & Christopher R. Taber, 2002. "An Evaluation of Instrumental Variable Strategies for Estimating the Effects of Catholic Schools," NBER Working Papers 9358, National Bureau of Economic Research, Inc.
    4. Derek Neal, 1994. "The Effect of Catholic Secondary Schooling on Educational Attainment," University of Chicago - George G. Stigler Center for Study of Economy and State 95, Chicago - Center for Study of Economy and State.
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    6. Evelyn Lehrer, 1996. "Religion as a determinant of marital fertility," Journal of Population Economics, Springer;European Society for Population Economics, vol. 9(2), pages 173-196, June.
    7. Gruber Jonathan H & Mullainathan Sendhil, 2005. "Do Cigarette Taxes Make Smokers Happier," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 5(1), pages 1-45, July.
    8. Levin, Jeffrey S., 1994. "Religion and health: Is there an association, is it valid, and is it causal?," Social Science & Medicine, Elsevier, vol. 38(11), pages 1475-1482, June.
    9. Laurence R. Iannaccone, 1998. "Introduction to the Economics of Religion," Journal of Economic Literature, American Economic Association, vol. 36(3), pages 1465-1495, September.
    10. Richard B. Freeman, 1986. "Who Escapes? The Relation of Churchgoing and Other Background Factors to the Socioeconomic Performance of Black Male Youths from Inner-City Tracts," NBER Chapters,in: The Black Youth Employment Crisis, pages 353-376 National Bureau of Economic Research, Inc.
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    12. Evelyn Lehrer & Carmel Chiswick, 1993. "Religion as a determinant of marital stability," Demography, Springer;Population Association of America (PAA), vol. 30(3), pages 385-404, August.
    13. Lipford, Jody & McCormick, Robert E. & Tollison, Robert D., 1993. "Preaching matters," Journal of Economic Behavior & Organization, Elsevier, vol. 21(3), pages 235-250, August.
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    JEL classification:

    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • N4 - Economic History - - Government, War, Law, International Relations, and Regulation

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