Why did religiosity decrease in the Western

World during the twentieth century?

Raphaël Franck & Laurence R. Iannaccone*

Bar Ilan University, Department of Economics,

Ramat Gan, Israel.

** Chapman University, Argyros School of Business and Economics, Orange, CA, USA.

1. Introduction

• Contemporary debates over religiosity almost always focus on church attendance.

• There are two major theories of religiosity:

1. The religion-market model: Iannaccone (1991), Iannaccone & Stark (1994), Gill (1999).

2. The secularization hypothesis: Weber (1905), Chaves (1994) and Bruce (2001).

The religion-market model

• Governmental interventions are major determinants of religious participation.

• The development of the welfare state had an impact on religious participation :

– it crowded out the churches’ charities (Gruber & Hungerman, 2007; Hungerman, 2007, 2009).

– it reduced the churches’ ability to insure their members against adverse income shocks (Dehejia et al., 2007).

The secularization hypothesis

• Industrialization, urbanization, low fertility, wealth and education depress religiosity.

• McCleary and Barro (2006)’s study of 68 countries in the 1980s and 1990s:– Development has a negative effect on religiosity.– Urbanization makes individuals less observant.– But education is positively correlated with

religiosity.

• A database on religious activity based on the polls conducted by the International Social Survey Program (ISSP).

• Long-run church attendance trends in the United States, Canada & most of Western Europe from the 1920s until the 1990s.

• The data show that religiosity decreased in the Western World during the 20th century.

2. Data

• Long-run data on church attendance (ISSP data)

• 10 countries in this study: Canada, Denmark, France, Ireland, Netherlands, Norway, Sweden, Switzerland, the UK and the USA.

• These countries were democracies during the 20th century.

• These countries have historically been Christian countries, i.e., Catholic or Protestant.

The ISSP data asked the following:• “When you were around 11 or 12, how often did you

attend religious services then?”• “When you were a child, how often did your father

attend religious services?”• “When you were a child, how often did your mother

attend religious services?”

Replies were coded into standard categories, ranging from “never” to “several times each week”.

The respondents were also asked about their denominational affiliation and that of their parents’.

Canada

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France

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Denmark

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Ireland

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Netherlands

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Sweden

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Norway

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Children Parents

Switzerland

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Children Parents

United Kingdom

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Children ParentsUSA

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Figure 2. Church attendance, enrollment in post-secondary institutions and social welfare spending in the United States, 1925-1990.

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1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Enrollment in post-secondary educational institutions (in % percentage of the population)Children's church attendance

Parents' church attendanceSocial welfare spending (in % of GDP)

Explanatory variables

Several sources: • Carter et al. (2006)• Flora (1983)• Organization for Economic Cooperation and

Development (OECD) statistics.

• National databases made available by each country’s bureau of statistics.

Income (GDP per capita)

• The secularization hypothesis: – religious observance is negatively correlated

with higher income.

• The religion-market model:– growth in GDP per capita has no effect on

church attendance.

Urbanization & industrialization • The secularization hypothesis:

– industrialization and urbanization make individuals more secular.

• The religion-market:– in urban areas, individuals seeking relief

would turn to religious institutions that provide charitable services.

Human capital

• Data on fertility, secondary education and post-secondary education

• The secularization hypothesis:– an increase in human capital decreases

religiosity.

• The religion-market model: – there is no straightforward relationship

between education, fertility and religiosity.

The welfare state

• Different measures of public spending (education, family, health, old-age)

• The religion-market model:– The welfare state lowered charity donations to

churches.

• The secularization hypothesis: – No specific predictions on the effects of public

spending on church attendance.

3. MethodologyWe run the following regressions

• Childrenc,t = αc+αt+βXc,t +εc,t (1)

• Parentsc,t = αc+αt+βXc,t +εc,t (2)

Childrenc,t church attendance of children in country c in year t

Parentsc,t church attendance of parents in country c in year t

Xc,t vector of explanatory variables

c,t error term with N(0;2)

Econometric issues

• Reverse causality – Cov(Xc,t, εc,t)=0

– Calls for Instrumental Variables (IVs)– Not an issue for the Industrialization,

Urbanization, Secondary Education and Post-Secondary Education variables.

• Persistency of religious behavior– Calls for a lagged dependent variable.

Estimation methodology

• Two types of 2SLS regressions:1. Births and GDP per capita are endogenous while

Govt Spending-Education, Govt Spending-Family, Govt Spending-Health and Govt Spending-Old Age, are exogenous.

2. Govt Spending-Education, Govt Spending-Family, Govt Spending-Health and Govt Spending-Old Age are endogenous while Births and GDP per capita are exogenous.

• Arellano-Bond (1991) GMM regression with Windmeijer (2005)’s finite sample correction for the two-step covariance matrix.

Instrumental variables (1/3)

To instrument for GDP per capita

• Tariff

Ratio of the average tariff duties over imports. Correlated with GDP (Clemens and Williamson,

2004) but not with religiosity (Grossman & Helpman, 2002).

• Strike

Days of work lost per worker as a result of strikes.

(see Cramton & Tracy, 1992, on causes of strikes).

Instrumental variables (2/3)

To instrument for Births

• Interest RateReal interest rate on long-term government bonds.

• Exchange Rate Real exchange rate between the US dollar and the

other countries’ currency.

Both variables are correlated with fertility(see Becker & Barro, 1988, Rose et al., 2009).

Instrumental variables (3/3)

To instrument for the welfare state variables,

Education and Family

Health and Old Age

• Strike (defined above)

• Unemployment log of the unemployment rate in each country.

• Net Immigration difference between the number of immigrants

& emigrants in a country.

We introduce a lagged dependent variable in Equations (1) and (2)

• Childrenc,t = αc+αt + βXc,t + γChildrenc,t-1 + εc,t (3)

• Parentsc,t = αc+αt + βXc,t + γParentsc,t-1 + εc,t (4)

where Childrenc,t-1 and Parentsc,t-1 are the lagged dependent variables.

Persistency of religious behavior

We can estimate Equations (3) and (4)

provided that in Equation (3)

Cov(Childrenc,t-1, εc,t)=Cov(Xc,t, εc,t)=0 as t→∞

and that in Equation (4)

Cov(Parentsc,t-1, εc,t)=Cov(Xc,t, εc,t)=0 as t→∞

Estimation technique

• The fixed effects OLS estimator can be consistent when the number of time periods in the sample increases, i.e., as t→∞ (Wooldridge, 2002).

• 2SLS estimator (Anderson & Hsiao, 1982).

• Arellano-Bond (1991) GMM estimator with Windmeijer (2005)’s finite sample correction for the two-step covariance matrix in order to obtain more accurate sample inference.

4. Results

Wealth & human capital

• GDP per capita variable does not have any effect on religiosity (or has a positive effect!).

• Post-Secondary Education variable is not significant in the OLS regressions.

• No systematic result for Secondary Education.

• Births is not significant in the OLS regressions.

• These results fail to confirm the predictions of secularization theories.

Urbanization & Industrialization

• Industries has a positive coefficient in almost all the OLS regressions.

• Urban variable also has a positive and significant in several OLS regressions.

• These results support the predictions of the secularization hypothesis

Public spending on welfare services

• Public spending on education & the growth in old-age expenditures depressed religiosity.

• Religiosity was not influenced by the increase in health- or family-related public expenditures.

• These results are consistent with the religion-market model which considers that religious participation is “supply-driven”.

5. Who stopped attending church during the twentieth century?

• We now break down our Parents and Children variables into sub-categories:

– Protestant Children and Protestant Parents– Catholic Children and Catholic Parents– Mothers and Fathers (Female and Male Parents)

– Daughters and Sons (Female and Male Children)

– Male Catholics and Male Protestants– Female Catholics and Female Protestants

Canada

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1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Catholic parents Protestant parents Catholic children Protestant children

France

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1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Catholic parents Protestant parents Catholic children

Ireland

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1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Catholic parents Protestant parents Catholic children

Denmark

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1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Daughters Sons Mothers Fathers

Netherlands

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1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Catholic parents Protestant parents Catholic children Protestant children

Sweden

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1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Daughters Sons Mothers Fathers

Norway

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1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Daughters Sons Mothers Fathers

Switzerland

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100

1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Catholic parents Protestant parents Catholic children Protestant children

USA

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1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Catholic parents Protestant parents Catholic parents Protestant parents

United Kingdom

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1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Catholic parents Protestant parents Protestant children

Canada

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1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Daughters Sons Mothers Fathers

France

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1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Daughters Sons Mothers Fathers

Denmark

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100

1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Daughters Sons Mothers Fathers

Ireland

0

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60

80

100

1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Daughters Sons Mothers Fathers

Netherlands

0

20

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60

80

100

1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Daughters Sons Mothers Fathers

Sweden

0

20

40

60

80

100

1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Daughters Sons Mothers Fathers

Norway

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20

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60

80

100

1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Daughters Sons Mothers Fathers

Switzerland

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1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Daughters Sons Mothers Fathers

United Kingdom

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1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985

Daughters Sons Mothers Fathers

USA

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1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990

Daughters Sons Mothers Fathers

• The results imply an instrumental view of religious participation.

• The results do not imply that religious participation is never demand-driven.

• The results imply that the decline in religious participation cannot be attributed to a decrease in the demand for religiosity.

Conclusion

The increase in public (welfare) spending significantly depressed religiosity in the West.

• Avenues for research– A secular welfare state to undermine radical

religious movements?– Which factors (other than education and income)

can explain the demand for religiosity?