In: R. Segal, K. von Stuckrad (eds.), Vocabulary for the Study of Religion Vol. 1-3 (VSR), Leiden, Boston:
Brill 2015. 11 pp., URL: http://referenceworks.brillonline.com/browse/vocabulary-for-the-
study-of-religion
Economy
Religion is part of the cultural meaning system in
which economic systems and the regime of capital are also embedded. On the one hand, culture
is partly altered by new systems of commerce,
and on the other hand it is an autonomous environment opposing, acquiescing to, or assimilating
these changes. It has been prognosticated that the
future of religion will take shape in an expanding
global religious marketplace. In this marketplace,
individualism is associated with the demand for
products in an on-going process of self-construction through the self-stylization of everyday life,
often as part of a commodity aesthetics. In the
context of vigorously intensified communication
across continents, markets supplying religious services have become global with respect to exchange
as well as with respect to imagination. As a result
of these trends, economy has become an essential structural element of the religious field, and
thus an imperative theme in the study of religion.
This also leads to ambivalence with regard to the
distinction secular-sacred: according to Charles
Taylor and others, the new and specifically modern forms of social coordination, like the market
economy, the public sphere, and the democratic
state are deeply secular immanent orders. Thus,
the intense interrelationship between religion
and economy raises anew the issue of the de-/
secularization of the field. Instead of accepting the
importance of economy and market forces for religion, some critics argue that religious production
should not be seen as taking place in a market, and
that the rationale of agents in religious contexts is
not related to profit seeking. Overall, the concepts
connected with the economics of religion are
highly controversial.
The Systematic Relationship between
Religion and Economy
Several relationships between economy and religion are common in societal debates, such as
Koch A._Economy.indd 1
debates on development assistance, poverty reduction, and charity. As a first orientation and more
systematic approach, Max Weber’s discussion of
socio-economics (Sozioökonomik) might help (1949
[1904]). Weber develops three relations of interaction between economy and society. Taking religion
as part of society, three options arise:
1.
2.
3.
Religion as an economic phenomenon (e.g.
religious firms as employers),
Religion as a non-economic phenomenon
that has economic effects (e.g. the influence
of mental models on consumer behavior, or
Christmas fairs), or
Religion as an economically conditioned
phenomenon (e.g. the spread of religion
along commercial routes, a good example
being Islam in East Africa, Ensminger 1997).
In this line of thought, where religion and economics are considered as distinct fields, Peter L.
Berger distinguishes religion as a “formative force”
and as a “dependent formation” of “economic culture” (1967: 128). Another branch of research growing out of this relationship is economic ethics, as
a further way of relating and interrogating the terrain of economy and religious ethos.
To relate economy and religion in such ways
already presumes their distinctiveness. This gives
rise to many methodological queries and has
prompted questions as to how to operationalize
religion and causal dependencies or cultural interferences: What are relevant sociometric parameters to describe religion in its possible impact on
shadow economies? How relevant to this impact
is closeness in the religion-state relationship?
And, more generally, how is historical causality to
be conceived? Religion is not a distinct factor in
pre-market economies, in cultures of exchange,
or with regard to its embeddedness within market economies or social networks. Such ideas have
led to questioning of the concept of rationality for
describing religious as well as economic activities,
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2
despite the central role of rationality in standard
economic theory. Notwithstanding these difficulties, religion has all along been treated as if it were
an entity on its own, that has guided economic
treaties, exchange rates and taxes. Even today
economists often overestimate the autonomy of
religious institutions as cultural forces.
Besides the taxonomy of Weber and Berger,
there is a tendency to use economy as a term in
cultural studies. Bourdieu and others see cultural
and religious practices as ways of production, circulation, and consumption within a material and
symbolic cultural economy. The specification of a
sacred economy is considered to be the “productions, circulations, and contestations of transcendent claims and sacralizing practices that operate
within any network of social relations” (Chidester
2008: 84). Thus, the fundamental operation within
a political economy of the sacred is to set apart the
sacred in the sense of Durkheim’s understanding
of religion. In this economy of signification, signs
in religion as well as in the arts are transformed
into commodities that can generate profits. A wellknown problem associated with the peculiarity
of the concepts of religion as well as economy is
due to this expanding of meaning to all sociallyembedded practices. It is difficult to determine
practices as religious and at the same time to keep
away from a substantial and universal understanding of religion.
For some years now, a specialized discourse
on the economics of religion has grown up that
addresses these questions historically and systematically. This strand of research opens up an option
according to which religion and economy are not
distinct realms but share a framework based on
action theory parameters. Always relevant are
the behavioral parameters of choice, trust, risk,
and investment. There are culturally-dependent
rules concerning how much payback is expected
from insuranc and investments, how to prevent
or seek risks, strategies of hedging against losses,
and stockpiling and value-creating. A merely
metaphorical use of economic vocabulary, and
thus only limited forms of economic expression
Koch A._Economy.indd 2
economy
and modeling, must be distinguished from the
expansion of economic theory as in economic
anthropology.
Systems of Commerce
The historic examples chosen to test issues and
groups were momentous for theory-building in
cultural economics. In the first place, economic
anthropology observed small-scale indigenous
societies and exchange markets with a low degree
of complexity, or societies in transition to capitalist economies. Therefore the prevalent theoretical
elements were often reciprocity, barter, gift, and
exchange, which are common in small groups. In
the literature on economics of religion, a distinction is also made between simple gift economies
and complex finance market transactions. A market economy does not evolve automatically, or parallel to social evolution from the exchange setting.
The constitution of a marketplace is dependent on
further factors, such as nation-building or a military conquest, where there is an urgent need for
goods and human capital. Apart from reconstructions of basal economies in economic anthropology, a classical discourse on religious economy has
existed for a long time, discussing sacrificing to
gods and bargaining with gods (do ut des). These
debates were fed into economic theory by Adam
Smith and led to a renewed economic approach to
religious agents and activities.
Capitalism, communism, liberalism, and transitional economies between pre-capitalist and
capitalist economies (Roberts 1995) have all been
discussed in the light of their religious premises,
ethics and consequences. In the Soviet Union, for
instance, Communism attempted to extinguish
the demand for religion by supplying Communist
doctrine and political ceremonies (Pfaff 2010).
The high degree of market regulation by the
Communist Party undercut the production of
religious goods and significantly raised their consumption costs (for example travel costs increased
with a thinner religious infrastructure).
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Economy
Religious coping phenomena go hand in hand
with rapid, destabilizing, overwhelming, and often
incomprehensible economization processes: prosperity religion, cargo cults, and occult economies
appear at the margin of these capitalizing processes. Debates about the varieties of capitalism,
for instance in comparative economic research,
refer to economic reproduction in local modernities. There, urbanization or de-traditionalization are not automatically linked to a decline of
religious affiliation, but may be adjunctive to an
increase in prosperity religion. From an economics
of religion perspective, it is therefore impossible to
state universal correlations, for instance regarding
the decrease of religion in conditions of economic
growth (Barro and McCleary 2003). Observations
are also made on the way occult economies revitalize religious and magical conceptions and
practices as a way of coping with the rapid introduction of finance market capitalism. In order to
explain the attractiveness of “magical” products
in impoverished societies, it is argued that these
“modern” economic instruments are unfamiliar,
that they create inequality and thus offer ample
scope for fantastic ideas and practices (working
zombies, bewitching credit cards) (Comaroff and
Comaroff 2001). Religious economies often play an
important role in identity construal. Islamic banking, for example, gained popularity as an ethical
expression of a modern Islam in the aftermath of
September 11, 2001. Attempts at environmental
sustainability, eco-friendly production, and ethical consumption have led among other things to
nature spirituality.
The Institutions of Market,
Organization, and State
In the past few decades the cultural and social
embedding of institutions has shifted into the
forefront of attention. Religious traditions have
also been taken into account as institutions, meaning in their principal constructedness and as sets
of social practices. Institutional arrangements can
Koch A._Economy.indd 3
3
be seen as answering the challenge of how coordination und cooperation in a society can best be
solved. The organizational field always communicates under economic conditions. Within this
newer theory-building, where new institutional
economics is one strand, the ideal and inadequate
concept of the neo-classical market was elaborated. Markets are no longer seen as self-regulating, atomistic, competitive, ruled by procedures
of utility-maximizing of rational agents with complete contracts, and open for exit and access at any
time. To a greater degree these new approaches in
economic anthropology, as well as in the new economic sociology, favor the steering and control of
markets, the bounded rationality of agents, incomplete contracts that also always rely on social
trust, networks instead of atomistic agents, and
the opaqueness of the economic dynamics with
unpredictable outcomes. New-institutionalism
sees institutions as ranging from informal rules
and habits to formal rules, constitutions, and
organizations with materializing tendencies and
buildings that enable religious aims to be transformed, memorized, and spread. Several aspects
are relevant here: the main tasks are the institutional mediation of expectations, control, legitimacy, trust, and sanctions. They are performed in
local religious markets, in organizations outside of
markets, in religious organizations, through state
regulation of religion, state religion, and transnational religious institutions. Economic transactions can only be understood with reference to
global contingencies and determinants. A bilateral
exchange no longer exists, even in remote corners
of the world. A supply-market-demand complex
with diverse actors at each step determines the
meaning of products, their value, and pricing. The
Shanghai stock market, for example, even though
mimicking this global capitalist institution, is in its
specific realization a fetishization of the Chinese
state (Hertz 1998).
These mechanisms as a whole constitute the
political economy that has been examined by
Marx in a different way from Weber. Issues of comparison are economic ethics, conditions of labor
9/22/2014 6:44:22 PM
4
and production, state regulation, denominations
and wealth, and the socio-economic position of
religious institutions. The new institutional theory
of organizational fields allows for religious aspects
of organizations, as well as for the organizational
structure of religions (Demerath et al. 1998). The
religion-state relation is economically significant
in so far as it creates regulations, restrictions or
support, and a certain sort of legality. In China,
for instance, most religions were forbidden under
communist rule before the opening and reforming of the party. Some therefore distinguish a gray
market, where religions have an ambiguous legal/
illegal status, and a black market, where they are
banned (Yang 2005).
Markets are coordination mechanisms and locomotives of religious pluralism. In the literature, one
sometimes gets the impression that market means
the same as economy, but this impression is a simplification. Market ethnographies see the abstract
market principle as a continuum ranging from diffuse interaction to empirical marketplaces. Some
economic transactions take place outside the market, like those within firms or those overseeing the
market, such as cartel authorities. Religious agents,
institutions, and firms are active in several sectoral
markets, such as education, social services, the
production of goods (printing companies, retreats,
breweries), and outside the market (ethic commission work, volunteer work). In these transactions,
religious institutions play diverse economic roles,
such as supplier, demander, club, principal, agent,
employer, distributer, consumer. From a historical perspective, early modern European markets
that were relatively closed have been examined
for their denominational features. Their political
economy is characterized by regional differences
in economic activities and political party affiliation, depending on whether Catholics or protestants are in the majority. The pluralistic religious
market in the United States of America has been
the central paradigm in US-American sociological
marketplace models since the 1970s. This mirrors
American pluralism by the mere fact of a strong
Christian denominational plurality supplemented
Koch A._Economy.indd 4
economy
by new religious movements. Market regulation on the part of the state is said to have severe
consequences on the competitive exit criteria of
religious suppliers and their initial investments.
Neoclassical economics maintains that the less a
market is regulated the more it will tend to encourage competition, thus increasing the demand for
religion. According to the neoclassical axiom of
market equilibrium, these endeavors will lead to
a condition where maximum utility is reached
between demand and supply.
In Karl Polanyi’s market model, as well as in
rational choice economics of religion, a market is
mainly determined by competition, monopolies,
demand, and supply. According to this normative
model, in so far as these markets are autonomous
and self-regulating, the state should not intervene,
and all factors of production (labor, land, human
resources, etc.) are marketable. In the context
of secularization theory, the religious economy
knows “winners and losers” who either disappear
after a short time or grow by triggering demand
due to a pluralistic supply of religious goods.
According to the latter approach, the Catholic or
Protestant monopolies in some regions, as well as
state regulation, are predicted to correlate with
lesser participation and productivity than pluralistic religious markets. So-called exceptions
from this rule prompted further debates (Jelen
2002). Religious demand is a “macro-level concept
describing the presence of segments of the population that are potential consumers of religion”
(Pfaff 2010: 236). It is not unproblematic that in
this theory religious demand is an axiom. People
are said to perpetually seek religious satisfaction,
salvation or belonging to a transcendent order.
The market model is not only idealized but culturally disembedded and normally does not reflect
the market’s idiosyncrasy.
Commodities and Goods
A frequent substantialist misunderstanding of economic theory involves the introduction of a reli-
9/22/2014 6:44:22 PM
Economy
gious type of goods (sacred goods, salvation goods)
or even spiritual or religious human capital. There
is no reason to introduce a new kind of goods or
human capital so long as there is no autonomous
feature from the perspective of culture theory. The
sacred is a contextual construction that can easily
be described analog to promises, future benefits,
and values, for instance as in the home buyer or life
insurance markets. From the point of view of cultural theory, part of Iannaccone’s definition of religious goods is therefore problematic: He describes
them as those household commodities that rely on
supernatural forces (1992: 125). This definition is
only valid if understood in emic narrative. It is true
that such commodities are produced not for market exchange but for the producer’s own consumption, with the benefit of religious capital-building
which may correlate with greater religious satisfaction (if this religious capital is understood as a
kind of context-specific capital, like that of regular
opera-goers, and not as a new kind on its own).
Economic goods do not need to be tangible. When
Weber speaks of salvation goods, he has an action
theory concept in mind that sums up the ultimate goal of many activities in the religious field.
Donations and charitable gifts are goods that bring
a moral or social intangible good in return, which
is this-worldly, such as belonging, or being pleasing in the sight of God. Stolz elaborates a typology of goods which are the means of reaching a
goal in a religious context, and combines it with
rational choice (2006). He keeps the Weberian
good of religious authority and calls it a positional
social good. The remaining two types of social religious goods are communal (rituals) and collective
(norms). Private goods in the religious context are
consumer goods (objects, courses), membership,
and personal goods (human capital, eternal life).
Commodities consist of goods and services.
The economic theory of goods is not uniform.
Some work in economics of religion adopts the
distinction between search goods, (post)experience goods, and credence goods. This approach
addresses the uncertainty associated with promised features and the quality of goods. In the con-
Koch A._Economy.indd 5
5
text of religion the quality of search goods can be
assessed upon inspection, as with a book, a scent
or a funeral speech. A middle position of (un)certainty is represented by experience goods, such
as fee-for-services in yogic practice, mediumistic
séances, healing stones, etc. In the context of charismatic born-again Christianity, for example, the
utility can be experienced only after conversion,
and as such is not testable from outside the religious system. Credence goods back-shift utility to
a payoff in the afterlife, or bind it to the existence
of supernatural beings. In the marketplace model
combined with the microeconomic household
production model, the benefit of household commodities is their otherwise unobtainable reward
in respect of afterlife, salvation, conciliation, etc.
In collective production, the problem of free riders
occurs, which can be solved by costly demands. By
this strategy of exclusion, the produced goods are
club goods.
Another distinction that is regularly applied to
religion is that of public goods that are non-rival,
like the demand for meaning in life. This good is
not in competition with others in so far as many
persons might see the same meaning in life without thereby decreasing each other’s good: in other
words, my use of the good does not make it scarce
for others. However, commodities in religious production are generally not nonrival or public in
the sense of non-excludable: religions also create
artificial shortages, for example by limiting the
number of the chosen, by creating a shortage of
salvation by godly temper, by limiting the emission of miraculous powers to specific times such as
festivals, to specific places or to ritually bewitched
substances. The century-long provision of public
goods by pious foundations in the Islamic Middle
East can be seen as a signaling of commitment by
property owners which gave them security and
property rights in return for their social services
(Kuran 2001).
In the context of the economization of modern life, a commodification of religion is often
described. Fetishism of commodities, from Marx
to the spirit of things (hau, see Marcel Mauss),
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6
economy
suggests that commodities are crucial for masking
or revealing social relations. In a consumer culture, religious communication is often achieved
by the marketing of religion. Cultural tensions
may arise between the two driving forces of
(Romantic) hedonism and Puritan asceticism
(Campbell 1987). Symbolic goods constitute identity through their consumption, and communicate
the person’s peculiar commitment. “What would
Jesus buy?” bracelets bought by evangelical protestants, for instance, serve as a reminder of their
anti-consumerist counter-identity. Religious consumer choice is patterned and in most approaches
seen as somehow rational. But what are relevant
parameters for consumption? Some point to other
social identities besides class, like race, gender,
being young, or coming from a specific area. How
diverse religious affiliations intervene in these
parameters to reinforce symbolic identity by the
purchase and display of goods is an open field of
research.
Ideology, Mental Models, Risk, and Trust
As early as Weber, affective and traditional practices were seen as constitutive environments of
economic behavior. Informal and formal institutions are closely bound together by trust and habit
that both rely on a shared framing of values or
→ ideology. These shared mental models or worldviews are economic issues in so far as choice and
the securitization of transactions are important
economic challenges. In his Philosophy of Money,
Georg Simmel wrote that trust is a socio-psychological feeling similar to religious belief. Trust in
money gives a feeling of personal security and
is based on confidence in state organization. In
the absence of this trust in monetary worth, for
instance, economic activities would become so
risky that they would have to be hedged, causing
a high transaction cost of protection. Against this
background, institutions are to be understood as
predictable reactions towards actors’ expectations.
It is common in today’s economics of religion to
Koch A._Economy.indd 6
interpret religion as a complexity-reducing shared
mental model which saves transaction costs,
meaning costs that arise from control, search for
information, making contracts, etc. A specific religious risk management and the signaling of trustworthiness are important for saving costs. Risk
management is especially difficult with respect to
beliefs concerning the last days and post-mortem
existence. Iannaccone transfers two customary
strategies for coping with risk from economics to
religion: diversification and use of experts (1995).
Private production diversifies the risks of religious
promises remaining unfulfilled by limiting buying
to smaller portfolios and experience goods on the
base of fee-for-service transactions; the benefit
obtained is instantaneous and is not shifted to the
future or to a post-mortem world. With experts
and witnesses on the supply side of religious institutions, the risks are minimized by information,
specialization, and credibility. Very recently, new
practices of binding the future have arisen in the
context of a cultural change in societal risk management: risk is not avoided but sought for. With
new financial products (securitizations, derivatives, swaps, etc.), the finance market does not
negotiate goods or services, but administers future
time in the form of the possibility of taking a decision at some point in the future.
Behavioral economics has yielded many insights
regarding fairness, altruism, and reciprocity as
rational behavior, intertemporal counting for payoff, probability estimation, sunken cost, and social
choice. Some have already been transferred to
religion: religious altruism as in the self-offering
of agents in suicide, the calculus of a millenarian
splinter group (Alles 2004), trust (Tan and Vogel
2008), the correlation between cooperation and
frequency of ritual (Ruffle and Sosis 2006).
Conclusion
Taking economic activity as a culturally-embedded
realm of human action, it becomes evident that
it is closely linked to other human actions and
9/22/2014 6:44:23 PM
7
Economy
institution building. For this reason, research tools
and insights into economic circulation, organizations, behavior, and marketplaces are more than
relevant for the humanities. This relevance does
not mean there are no differences between economic activity and other sectors of cultural production. Nevertheless, interdisciplinary work that
is informed by economic theory is still rare.
A desideratum for the economics of religion is
the ability to distinguish between different kinds
of markets: commodity, stock, labor, and capital
markets follow different rules. At least Chidester
mentions that the “sacred” is produced through
the religious labor of interpretation and ritualization (2008: 89). Future reflections should touch on
the peculiar religious labor market, and the particular religious production which is its context.
Furthermore, the goals and pay-offs of religious
activities are frequently contested: religious symbolic production may work as an instrument of
empowerment, or subjugation, or both, depending
on who performs it. There has also been no discussion so far of the phases of market development
and their distinct challenges for economic action.
It makes a difference for the expansion of religious movements and organizations whether they
expand into a saturated monopolist or pluralist
market, or whether the product is mature or still
in the process of development. Against this background of market phases, the enormous success of
modern Western postural yoga, for instance, can
be interpreted by the absorption of the new technology of relaxation therapy (progressive muscle
relaxation), the marketing of it as ancient Indian
and spiritual (see Raya Yoga at its outset), and
the created need for deceleration in popular discourses of early industrialization (to name just a
few important elements).
Much greater use could be made of economic
concepts. Financing and pricing could be starting points. Cheap and expensive religions have
been distinguished. High prices have been used
as a strategy to stop free riders, and to signal commitment, trustworthiness, and cooperation, especially in ritual economics. Some themes have been
Koch A._Economy.indd 7
poorly understood, for instance the role of religious organizations in non-profit markets, multilevel strategies like community building and social
signaling, the implementation of highly complex
aim chains like fighting against evil, poverty, discrimination, and depression. Not easy to evaluate
are claimed successes and benefits such as the saving of souls, human growth, altered consciousness,
or detachment from earthly interests. The same
goes for the effects of governmental welfare interventions in the organizational field, inasmuch as
charitable, religious, and worldview-based associations have to apply as faith-based organizations.
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