Share on Google Plus Share on Twitter Share on Facebook Share on LinkedIn Share on PInterest Share on Fark! Share on Reddit Share on StumbleUpon Tell A Friend 2 (2 Shares)  
Printer Friendly Page Save As Favorite View Favorites View Article Stats   12 comments

Life Arts

The Costs and Benefits of Belief: An Economic Perspective

By (about the author)     Permalink       (Page 1 of 1 pages)
Related Topic(s): ; ; ; ; ; ; ; ; ; ; (more...) ; ; , Add Tags  (less...) Add to My Group(s)

Interesting 5   Must Read 3   Well Said 3  
View Ratings | Rate It

opednews.com Headlined to H3 3/14/12

Become a Fan
  (9 fans)

It may sound a bit unorthodox, but the intended purpose of this article is to examine whether or not the rule of economic rationality applies to non-economic decisions such as choosing a religion. That is, do people actually assess the costs and benefits of committing to a certain belief system before choosing it, given they are free to do so? First I provide some background information by discussing some key economic ideas and then address issues in conjunction with some empirical evidence.

Rationality is one of the core ideas of economics, suggesting that given the available information on pending costs and benefits, individuals make decisions that best serve their objectives of maximizing their gain and/or minimizing their loss. People habitually follow the rule of rationality for most of the decisions they make no matter how critical or trivial they may be. When in a grocery store, for instance, it is hard not to notice how customers move around with their shopping carts in search of the shortest cashier's line. Why do people do this? The answer is simply that they are looking for of an opportunity to minimize the cost of the time spent waiting in line. Even if a person is unemployed, his or her time seemingly has some value. It may not necessarily be a monetary gain that is valued, but rather the desire to do something more pleasurable with his or her time instead of waiting in line. The existence of several cashier lines in big stores like Wal-Mart, for example, makes waiting in line similar to participating in a competitive market that offers a number of choices. Just as a person seeks to buy goods and services from dealers having the lowest prices, a person tries to find the shortest line in a groc ery store, the one that minimizes the amount waiting time.

Admittedly, the opportunity cost concept can be a helpful analytical tool in exploring the motive behind human action or lack of it. It is an entrenched concept signifying that people carefully assess the economic consequences of their decisions before making them. If you are an unemployed person or a minimum-wage worker, for example, you may not mind having to travel in your car, even if it takes several hours. However, a highly paid CEO of a business firm will not choose to do so, but instead flies first class because the opportunity cost of his time is high enough to make driving an expensive option for him. Likewise, many individuals may refuse to accept free stuff from other people because getting something for free may involve some kind of costly sacrifice, such as missed opportunities. In summary, even if there is no monetary cost involved in a decision, there is always an opportunity cost related to every action we take. Needless to say, there is no free lunch.

Undoubtedly, information plays a significant role when it comes to making a rational decision. If, for example, you see a customer with many items in his shopping cart in a cashier's line, or if you anticipate a problem in a particular line that may prolong your wait time, you try to avoid staying in that line. People will continue to move around in search of finding the shortest line until all the lines have eventually the same length, implying that further movement is no longer advantageous. As an economic dictum, weighing the costs and the benefits allows consumers to implement the rule of economic rationality.

It can be postulated that behaving selfishly when it comes to our own economic welfare is hardwired into our brain. Just as consumers have an innate tendency to search for dealers offering the lowest priced goods and services, business people spend a great deal of resources collecting what they think is trustworthy information on the expected costs and the benefits before making an important decision such as investing in a particular project. In light of this, I venture to argue that cost-benefit calculation plays a significant role in people's decision- making concerning all kinds of life matters, including getting married and having children. A cost-benefit calculation even impacts our decision to choose a religion, or how strictly we will follow its religious codes. The economics of this sacred life matter is what I will specifically explore.      

Obviously, if commitment to a particular religion is governmentally compulsory and choices are not available or are extremely limited, people may assume the pretense of faithfulness to the prevailing religion, while deep down they have less regard for it and don't practice it the way they are directed to. This happens especially in certain Islamic countries like Iran. In this authoritarian Islamic government, participation in the official religion is mandatory and, therefore, superficial allegiance has become a survival strategy for many.   Superficial allegiance is merely camouflage--a life-saving safeguard to avoid persecution, public harassment, and even harsh punishment given the fact that open infidelity or conversion to another religion is apostasy and potentially punishable by death. I can claim confidently that out of the official statistic of 98% of so-called Muslims in Iran, a great percentage of them are what I call Muslims by default, an army of pretenders. Since they are born into a Muslim family and raised in Iran, they inherit the family's religion and thus automatically become Muslim.   Had they been born in a Western country to a Christian family, they would have been Christian for sure. On the other hand, if freedom of religion is protected, as it is in democratic societies, then weighing up the costs and benefits of religious affiliation certainly matters, especially to those who are marginally attached to a religion.

Although the monetary benefits of piety or religiosity are considerable, it is undeniably the non-monetary benefits of religious practice that entice most people, the promise of heavenly rewards and an eternal blessed life after death. Nonetheless, that does not mean that pecuniary benefits do not matter. They do, especially for underprivileged followers who seek security through social affiliation and capitalize on financial gains such as receiving charity, government handouts, cheap or interest-free loans, etc. These worldly benefits, and not necessarily the promise of paradise, may explain why some people espouse a religion so vehemently. Furthermore, the emergence of Islamic governments in a few Muslim countries, especially following the triumphant uprisings in some Arab countries, has given momentum to a new kind of radical congregate of Muslims. These people who have been suppressed or have been kept silent by a secular government up until now have moved to the center of power, and are enjoying recognition and political and social power. They are now experiencing revival, are becoming a decisive force in governance systems, and are deadly serious in their convictions. Although very small in number, they have acquired a great deal of power and political clout. They are willing to do anything and everything for the sake of their faith.  

Because of more stringent requirements imposed under such regimes, going along with stricter religions like Islam entails big explicit as well as opportunity costs for true followers. Accordingly, such religions may appeal better to lower income people who do not have much to lose by spending a great deal of time performing mandatory prescribed duties such as daily prayers, fasting, dietary restrictions, and fighting temptations. This may explain why a strict religion like Islam is more popular in poor countries and why poor people are attracted to this religion.

Knowingly or unknowingly, religion has effectively used reward and punishment, carrot and stick policies for centuries to winnow fervent believers from spurious ones, policies that have become tools for polarization and transforming religion into a self-serving organization. For instance, by using segregation tactics like dividing people into believers and non-believers, faithful and infidels, Mojaheds (worriers for the faith) and Monafeghs (cowards), Islam has been successful in creating a fictive, albeit appealing, bond to keep its devotees connected. It has also cunningly catered its reward system to the popular needs and the expectations of its followers. This tactic has also served to confine naive devotees to the sunken cocoon of isolation and away from exposure to the opportunities they may find in the outside world. The Islamic government in Iran, for example, has chosen to solidify its power by investing handsomely in creating a new variety of diligent aficionados like Basiji (mobilized), Pasdaran (guardians), and the Hezbollah (the party of God). All of such organizations recruit young Iranian volunteers who are primarily from low income families or live in rural areas. They can be mobilized on short notice to assist the regular police force in imposing Islamic morality codes or to crush anti-government demonstrators. In exchange for this assistance, they receive monetary benefits supplied by the government or receive preferential treatment when it comes to allocating public services.

Fearful of losing creditability and followers under the threat of modernity, scientific discoveries, and secularism major religions have reacted differently and have implement new strategies.   Christianity has to some extent responded by modernizing and modifying some ideas that seemed impractical in the 21st century. Islam has responded by fomenting extremism and propagating new generations of young radicals who are ready to take any drastic actions for the cause of their faith. This Islamic tactic seems to have worked well so far. Islamic authorities have elevated the standards by increasing their pressure on zealous disciples and creating a clan-like mentality to lure new loyal followers who are truly committed to stringent rules, ready to endure hardships, and make sacrifices even to the point of taking up arms. Thus, it can be argued that when some religions are threatened by science or secular forces, a successful response is to fire up and empower its radical followers. It may sound counterintuitive, but there seems to be a positive correlation between how demanding a religion is and its appeal to certain groups of people. Unlike ordinary businesses and in defiance of the law of economics, religion can actually increase price and still retain loyal customers and/or generate new ones.   This tactic has been successful for the same reason that people purchase high price items or join expensive social clubs; they do it just for the connotation, the snobbish appeal, achieving a particular life style, and cultivating a sense of belonging to certain elites and creating fictive kinships.

What's more, it can be argued that by lowering the cost of compliance by making requirements less stringent, some religions have attracted a massive number of well-off followers and effectively prevent them from defecting because of the lack of any consequences for doing so.   However, in the absence of such an approach, most followers believe in the principle ideas of their religion, but may not strictly follow its time-consuming requirements or the inconvenient tenets of its theology.   According to a public survey by Pew Forum conducted in 2007, while 92% of Americans believe in God, only 58% of them pray at least once a day. This percentage is inversely correlated to the level of personal income, with 64% for those with an income level of less than $30,000 and only 48% for those with more than a $100,000 annual income.   Further inquiry into the same survey reveals that the percentage of people who pray frequently is high, 70% and higher, in low income states such as Mississippi, Louisiana, Arkansas, Alabama, and Tennessee, while this ratio is much lower, between 40 to 50%,   for high income states including Massachusetts, Main, Connecticut, Alaska, and New Jersey. Such findings lend further support to the proposition that the degree to which people practice a religion varies indirectly with their level of income.   These findings also help to explain why in economically advanced nations like the U.S., the percentage of people believing in core ideas of religion and belief in God is so high. Believing in God has no cost, but instead has a lot of benefits. However, when it comes to fulfilling the costly stringent requirements of belief, the percentage of followers shrinks to a lower level as the opportunity costs rises.

Prudently, some Christian religious leaders have tried to grapple with 21st century challenges and have made some modifications that may have kept some of their marginally attached followers from deserting. Islamic rulers, on the contrary, have refused to do that or have reluctantly made slight changes. This is why Islam is dominated by a small flock of hard-core, noisy believers and an army of pretentious followers, the by-default Muslims who have no choice but to pretend that they are faithful. Consequently, the minority of noisy followers control the life of the silent majority who deep down do not agree with the minority's gloomy version of Islam.

If valid, the preceding argument ascertains a positive correlation between the strict demands of a religion such as Islam and its appeal to low income devotees, those who fervently fulfill religious duties and can amply spend their time without incurring much opportunity cost. Thus, religion becomes an obsession for poor zealous followers, and a necessary life-saving or a social status event for the rich. The rich may occasionally attend places of worship like mosques just to fake their support, or to protect themselves and their fortunes from potential harm that may be inflicted upon them if they are labeled as non-believers. However, they are less enthusiastic about the tedious details of compliance, which are quite costly for them. These Muslims, by default, get a free ride and enjoy the benefits of religion without incurring much of the cost of personal sacrifice.  

 

Reza Varjavand (Ph.D., University of Oklahoma) is associate professor of economics and finance at the Graham School of management, Saint Xavier University, of Chicago. He has been an avid participant in many professional organizations and active in (more...)
 

Share on Google Plus Submit to Twitter Add this Page to Facebook! Share on LinkedIn Pin It! Add this Page to Fark! Submit to Reddit Submit to Stumble Upon

The views expressed in this article are the sole responsibility of the author and do not necessarily reflect those of this website or its editors.

Writers Guidelines

Contact Author Contact Editor View Authors' Articles

Most Popular Articles by this Author:     (View All Most Popular Articles by this Author)

Legalized Market for Human Kidneys: a Problem or a Panacea?

Nonbeliever Nation, The Rise of Secular America

Growing Underground Economy, A Cause For Concern

Looking Back To Move Forward: Resuscitating The Ailing U.s. Economy

Ignoring Scientific Realities is Not Good for America

The Evolution of God, Is God a Figment of Human Imagination?

Comments

The time limit for entering new comments on this article has expired.

This limit can be removed. Our paid membership program is designed to give you many benefits, such as removing this time limit. To learn more, please click here.

Comments: Expand   Shrink   Hide  
10 people are discussing this page, with 12 comments
To view all comments:
Expand Comments
(Or you can set your preferences to show all comments, always)

Waviness Because we are wave beings; albeit e... by molly cruz on Wednesday, Mar 14, 2012 at 4:46:24 PM
I enjoyed reading your comment and appreci... by Reza varjavand on Wednesday, Mar 14, 2012 at 8:22:17 PM
Great insight into religious behav... by Seymour Patterson on Wednesday, Mar 14, 2012 at 5:47:25 PM
Even a scant examination of the key economic... by Reza varjavand on Wednesday, Mar 14, 2012 at 9:02:36 PM
Here's another question. Why would a woman follow ... by Shankari Kali on Wednesday, Mar 14, 2012 at 5:55:12 PM
A good question, the simple answer is that rel... by Reza varjavand on Thursday, Mar 15, 2012 at 8:40:36 PM
I really like how it was all said and supported wi... by Michelle Quiroz on Thursday, Mar 15, 2012 at 3:10:01 PM
I'm sure all your readers appreciate the time and ... by WJ Seng on Thursday, Mar 15, 2012 at 10:56:39 PM
When it comes down to cost and benefit analysis in... by Niaya Ellis on Friday, Mar 16, 2012 at 9:52:23 AM
I personally believe that people make religious de... by saleh alwasyiah on Friday, Mar 16, 2012 at 4:13:43 PM
Although I am not versed in the Muslin religion, I... by Agnes Marie Pritchard on Wednesday, Mar 21, 2012 at 8:11:10 PM
The author argues here that one the benefits o... by Jack Rocha on Thursday, Mar 22, 2012 at 2:03:36 PM