Islam and Economic Progress

by Joseph Sunde

Examining the connections between religion and economic growth can be a tricky task. Thankfully, some great thinkers have stepped up to the challenge.

Great minds like Max Weber, Michael Novak, and Rodney Stark have provided compelling arguments to support the notion that Christianity has been a driving force behind numerous economic gains (the most prominently of which is capitalism itself). Weber, for example, promotes the idea of a “Protestant work ethic,” a term that links much of our economic productivity to the Christian notion of “fruit.”

But according to John Cassidy, author of a recent piece in the The New Yorker titled ”Prophet Motive,” such critiques place far too much emphasis on religion itself. In this case, however, Cassidy is not criticizing Weber for his defense of Christianity; he is criticizing “the new Weberians” for their attacks on Islam.

These “new Weberians” include Bernard Lewis and David Landes, two academics who are widely respected, despite Lewis’ unpopularity within a particular school of Orientalism. Although Cassidy notes the impressive nuance and tact with which both of these men conduct their criticisms, he remains unconvinced that Middle Eastern economies are lagging due to issues with Islamic culture or faith.

As Cassidy cautions us:

[B]efore consigning a fifth of humanity to the dustbin of economic history, one might consider, more broadly, whether it makes sense to place such an emphasis on religion in explaining the underdevelopment of so many Muslim countries.

The nit-pickiness of this may seem a bit overblown, but Cassidy is right to emphasize the importance of the underlying distinction. Are matters of spiritual devotion and worship relevant to our discussions of economic progress?

Cassidy says they aren’t, pointing to more “traditional methods” of analysis such as focusing on “the way beliefs are codified and institutionalized,” rather than dwelling on theology, philosophy or moral doctrine (as Weber and Novak do). For Cassidy, the matters related to the religion itself —the “spiritual stuff” — are largely unreliable. To make real progress in analyzing religion and economic growth, Cassidy believes we should look toward firmer, more measureable developments in the politico-religious (e.g. usury laws, business partnership, limitations or inheritance practices, etc.).

These areas are more than worthy of investigation (that’s why we call them “traditional”), but by focusing our sights only on that which is “codified” or “institutionalized,” Cassidy inadvertently robs religion of its overarching purpose: to provide meaning and value to the individual by explaining his place in the world on a spiritual level.

If we are going to analyze the merits of a particular religion as it relates to an economy, it makes little sense to toss out the fundamental features that define religious institutions and set them apart from those in the socio-political realm.

Whether formally codified/institutionalized or not, our religious beliefs and convictions fundamentally transform our perceptions, and thus they largely impact our visions. Regardless of whether the specific religion, god, or authoritative text is actually true, Islam has just as much potential to instigate such an effect as Christianity.

To more clearly understand how an overarching religious framework might have an effect on economic growth, it may be helpful to examine some high-level contrasts between Christianity and Islam.

For example, Islam, as is commonly understood, is inherently political (and always has been). Whereas Jesus urged us to render under to Caesar what is Caesar’s and unto God what is God’s, Muhammad urged his followers to promote him as Caesar as a means for rendering unto God. (This precedent was happily followed by the caliphate.) To see the economic impacts of such a fusion, one can easily review the general economic histories of any given Muslim country.

For a modern example of the positive effects of post-Islamic de-centralization, one can learn much from Turkey, an example of (relative) economic strength in the Islamic world. As many of you know (and Cassidy himself explains), Atatürk abolished the caliphate in the early 20th century, imposing a “strict church-state divide” which drastically changed the trajectory of Turkey. The result? A society that was (and is) far more secularized and far more free than its Middle Eastern counterparts from a governmental standpoint. With the removal of Islam as an overarching religious force, the individuals on the ground have been better able to prosper.

The cause-effect takeaways from such an example would be that centralized control does not typically bode well for economies, and centralized control is an inherent part of Islam itself (not just some line item in its legal history). The prospects of the actual religion — as it relates to politics and economics — does not seem to bode well for freedom, knowledge, or individual flourishing (key factors in economics, even by UN standards).

This is a brief example indeed, and one with which we could engage in extensive debate. But this is precisely the debate that Cassidy seeks to disengage altogether.

As Cassidy concludes:

[D]ay-to-day worship of the sort practiced by hundreds of millions of Muslims is no more what is holding back the Middle East than Hinduism was what held back India or Roman Catholicism was what held back Ireland. Despite the arguments of new Weberians, people have always found a way to serve their gods and Mammon, too.

If this was the real point of our human pursuits — to find ways to serve our gods and Mammon [js1] — than perhaps we should follow Cassidy in his shruggery. In addition, if select executions of religious devotion — whether in Christianity, Hinduism or Islam — are to automatically be taken as indicative of the religions as a whole, he might also be correct.

But alas, there is much more for us to discover, and I am convinced that much of the information we’re looking for can be found in our religions themselves. We would do well to branch beyond the “traditional” economic factors and wrestle with the areas that are hard to lock down in a spreadsheet.

In the businessman’s world, such unknowns are commonly referred to as “blind spots” to be aware of, not to shy away from (that is, if one is so lucky as to identify them early on). In the economist’s world, however, Cassidy shows that they are often seen as “unmeasurables.”

In today’s context, that may certainly be the case. But if so, I think it’s high time we find the instrument that will get the numbers moving.

  • Just Thoughts

    The path he chose was a path going in the opposite direction of many his age, but he chose it with the same thirst for swift achievement. As soon as he reflected seriously on it, he was convinced and convicted of the existence of God and of the immortality of the soul, and at once he instinctively said to himself: 'I want to live for immortality with Him and I will accept no compromise.' -Dostoevsky, Brothers K