Faith and the Economy
Why Strict Religions Thrive: The Club Model
How economist Laurence Iannaccone explained why demanding religious groups can grow, using the idea of club goods and free riders.
Why do some religious groups with strict rules grow, while more relaxed ones sometimes decline?
The club model
Economist Laurence Iannaccone argued in 1994 that religious groups provide club goods: benefits shared by members, like community, support and worship.
The free-rider problem
In any club, some members enjoy benefits without contributing. If too many free ride, the club weakens.
Strictness as a filter
Strict rules on dress, diet or time commitments:
- Screen out less committed members.
- Increase participation among those who remain.
- Make the group’s benefits, like mutual help, stronger.
Examples
- Groups with strong commitments often provide robust mutual aid, like helping members find jobs or care during illness.
Limits
Too much strictness can drive people away. Groups need a balance.
Economic lens
The model shows how economics can explain institutions beyond markets, including religious organisations.
A tight-knit religious group with strict weekly commitments helps a member who lost his job by finding him work through other members within weeks.
Strictness can screen out free riders and strengthen commitment.
- Religious groups provide club goods to members.
- Free riders weaken clubs.
- Strict rules screen out less committed members.
- Balance is needed; too much strictness drives people away.
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