The Almighty and the Dollar

Economics is often portrayed as the most secular of the social sciences. That, however, has never stopped scholars, including economists, from contributing to discussions on the relationship between religion and economics. Nor has it inhibited them from writing vast tomes about religion’s role in capitalism’s emergence.

This line of inquiry is invariably associated with Max Weber’s Protestant Ethic and the Spirit of Capitalism. Its publication in 1905 gave rise to a new genre of scholarship as expressed in books like R.H. Tawney’s Religion and the Rise of Capitalism (1926) and Amintore Fanfani’s Catholicism, Protestantism, and Capitalism (1935). What is common about most such texts is their attempt to establish some causation between particular religious faiths and the advent of the most transformative economic system in history.

I have long been skeptical of such endeavors. It is notoriously difficult to establish linkages between particular theological positions (which often turn out to be misrepresentations, if not caricatures) and specific economic ideas, institutional forms, or expressions of economic culture. For every claim that a specific religious entity, ethic, or figure provided the vital ingredient or a “decisive” impetus for the development of capitalism, there are plenty of counter-examples. The Industrial Revolution first occurred in Britain, a predominately Protestant nation. Yet the second country to go down the path of industrial capitalism was Belgium, closely followed by the Rhineland and Silesia in Germany, and then northern France—all Catholic regions not especially known for the influence of Puritan ethics that Weber identified as playing a critical role in capitalism’s emergence.

Thus far, it has proved hard to get beyond broad generalities in this area. There’s a case to suggest that Judaism and Christianity’s conception of God as a creative and rational being, their de-divinization of the natural world, linear view of history, stress on free choice, and confidence in reason’s ability to know truth eventually transformed people’s understanding of themselves and their relationship to the material world in ways that enhanced economic productivity. That, however, is a far cry from being able to say with confidence that, absent specific Christian or Jewish ideas or doctrinal positions, post-Enlightenment economics would have been very different.

Even establishing firm associations between an individual’s religious beliefs and his economic views is not a simple matter. Numerous factors help form our opinions of many subjects. Hence, to say that a person’s religious faith or background explains why she favors free markets over socialism or vice-versa is a perilous exercise, given all the other dynamics (family setting, education, political beliefs, self-interest, employment experience, philosophical commitments, etc.) likely to be at work. If the linkage between particular religious beliefs and certain economic positions was so clear, why do people who cleave closely to the very same doctrinal teachings often end up advocating very different economic positions?

Then there are arguments that religious beliefs exert influence on people’s economic ideas without them even knowing it. Perhaps they do. But I have yet to see anyone studying these questions get beyond cautious, hyper-qualified conjectures—or, more commonly, raw assertions.

Predestined and Enlightened

This brings me to Benjamin M. Friedman’s Religion and the Rise of Capitalism (2021). The broad title is misleading, as the Harvard political economist’s focus is primarily on various Protestant doctrines and confessions and the way in which he believes they shaped specific economic ideas in Britain, colonial America, and the United States.

Friedman begins with Adam Smith’s Wealth of Nations, which he presents in the context of the philosophical ideas at work in the late-17th and 18th centuries. But he also situates Smith’s intellectual revolution against a background of religious beliefs and debates that had flowed out of the Reformation and continued to spark controversies over ensuing centuries throughout Europe. The doctrine of predestination assumes a central place here. After explaining its roots in Scripture and the theology of figures like Augustine, Friedman traces how predestination acquired specific form in John Calvin’s work and the ways in which Calvinist treatments of this topic gradually worked their way through the religious landscape of the British Isles.

The Enlightenment stress on improvement was not necessarily seen to be in conflict with standard Calvinist takes on predestination.

Friedman’s reflections on the emergence of Smith’s economic thought and its relationship to philosophical movements of the time are more solidly grounded than his account of associated theological developments. Friedman argues, for instance, that the major innovations in economic thought pioneered by Smith owed much to a fading of the more traditional Calvinist positions on predestination that had hitherto reinforced (presumably) fatalistic and pessimistic views of reality. A waning of such views, we are told, opened the door to greater optimism about humanity’s potential to shape the world through the emerging social sciences.

Part of the fading which Friedman has in mind reflected the religious atmosphere surrounding highly-educated 18th-century Scots like Smith. This was a world in which the intellectually dominant Moderate Party faction of the Church of Scotland, led by Presbyterian clerics like Rev. Francis Hutcheson (Smith’s tutor at Glasgow University), Rev. William Robertson, and Rev. Hugh Blair, moved away, by Friedman’s account, from more orthodox Reform accounts of predestination. This meant that people were increasingly open to more hopeful possibilities for the future, such as those articulated in the Wealth of Nations.

A major difficulty with this account is that Reformed conceptions of predestination (like all Christian churches’ doctrines of predestination) have always had more complicated relationships with questions concerning human liberty, natural law, progress in this world, and the freedom of the will than Friedman suggests. Hutcheson and Blair certainly articulated an optimistic view of humanity and our capacity for virtue. But this didn’t mean that there was an enormous gap between their views about predestination and those which were relatively standard among Presbyterian and Reform clergy and theologians throughout 18th-century Northern Europe.

Nor is it clear that many of those who belonged to the Church of Scotland’s more overtly orthodox wing (known as the Popular Party) who held to stricter visions of predestination were necessarily closed, let alone hostile, to the new learning associated with the Scottish Enlightenment. There’s no evidence, for example, that Rev. John Witherspoon, the prominent Popular Party leader and eventual signer of the Declaration of Independence, had any difficulty absorbing or accepting the key economic messages of books like the Wealth of Nations. Presbyterian clergy like Witherspoon, in his capacity as President of the College of New Jersey (later Princeton University), made a point of incorporating Scottish Enlightenment emphases and texts into their reforms of college curricula throughout colonial America. At least in these cases, the Enlightenment stress on improvement was not seen to be in conflict with standard Calvinist takes on predestination.

American Religion, American Economics, American Politics

The second half of Friedman’s book discusses the American experience of Protestant faith, doctrines, and practices and how they have shaped American attitudes towards economic issues. Part of Friedman’s argument is that the fading of orthodox Calvinist predestination doctrines created more space for the types of outlooks that were amenable to economic creativity and growth.

Protestant clergy, Friedman notes, reflected upon and wrote a great deal about economics in 19th-century America. Of the 181 founding members of the American Economic Association, 23 were ministers of various Protestant churches. Friedman also states that doctrines about predestination do not appear to have played a significant role in shaping their economic thought. This much is true. But did this absence of attention to predestination contribute, as Friedman claims, to more positive views about the capacity of economics to improve the world? If so, how precisely did that occur? Once again, meaningful causation is not established.

The last part of Friedman’s book explores why adherents of particular Protestant confessions have supported economic policies ranging from those associated with the Social Gospel movement to the fiscal conservatism that began its rise to prominence on the American right in the 1960s. Friedman focuses on the political preferences of those Americans who (at least nominally) belong to different faiths and their views about the state’s economic role and whether people can become socially and economically mobile through their individual efforts.

Among other things, Friedman argues that Evangelical traditions of favoring voluntary and associational solutions to social and economic problems help to explain the small-government views and conservative-leaning voting patterns of this segment of America’s population. Again, I’d suggest, we can at best say, “Well, maybe.”

Yes, such traditions exist. Perhaps they did incline American Evangelicals to favor smaller government and less economic intervention on the state’s part. But how do we assess that? What about the weight of other factors that may have been at work? Maybe Evangelicals were simply, like many Americans of all faiths and none, deeply unimpressed by the social and economic results of the New Deal and Great Society. Could it be that some Evangelical leaders encouraged members of their churches to support fiscally conservative policies as part of an implied deal with other groups to build a political movement that would also promote goals closer to their hearts like rolling back Roe v. Wade, protecting religious liberty, or defeating atheistic communism?

The short answer to these and similar questions is perhaps, or perhaps not. In short, despite Friedman’s best efforts, we don’t appear to be getting any closer to the truth of such matters. Attempts to assess religion’s role vis-à-vis economic ideas, preferences, and practices all too often confuse correlation with causation, or simply advance hard-to-prove and easy-to-dispute hypotheses. Our understanding of how religious beliefs, doctrines, institutions, and habits shape economic life and ideas consequently remains fragile, tentative, and heavily driven by speculation and ideology rather than compelling evidence. The topic, however, remains a best-seller. Ergo, as any economist will tell you, we can expect more of the same.


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