Religion plays major role in economic growth, new research finds
freesuntimes.com · post 60397 · 2026-06-27
LONDON, June 27 — The shift is one that conventional economics has largely overlooked. A new study published in May by RFBerlin argues that religion has exerted a far greater influence on economic development than many economists have recognised, shaping everything from education and financial systems to family size, technological innovation, and political institutions.
The research, a review by economists Professor Sascha Becker of the University of Warwick, Professor Jared Rubin of Chapman University, and Professor Ludger Woessmann of the University of Munich, challenges standard economic theories that focus primarily on investment, technology, and human capital. Instead, it contends that religion has often operated behind the scenes, influencing the very factors economists use to explain growth.
“Religion affects economic growth not just through individual beliefs, but by shaping the fundamental institutions and norms that govern society,” the study says. That single line captures the trend underneath a lot of development economics that has, until now, treated religious factors as noise rather than signal. One of the clearest examples highlighted in the research is the impact of the Protestant Reformation on education.
Martin Luther’s conviction that ordinary believers should be able to read Scripture for themselves encouraged the establishment of schools throughout Protestant regions of Europe. By the 19th century, Protestant areas of Prussia had significantly higher literacy rates than neighbouring Catholic regions.
This educational advantage helps explain why Protestant regions often experienced stronger economic development. That finding challenges the famous theory of sociologist Max Weber, who linked Protestant prosperity primarily to a unique “Protestant work ethic.” The new research suggests the mechanism was less about hard work and more about widespread literacy and schooling. The influence reached far beyond Europe, the economists note, with religious institutions shaping legal systems, attitudes toward credit and interest, and even the timing of technological adoption across continents.
What’s changing here is the willingness of mainstream economists to look beyond purely material factors. For decades, development models have treated religion as a cultural curiosity rather than a causal variable. This study flips that assumption.
It argues that religious beliefs, institutions, and practices have left a lasting imprint on economic performance across the world — and that ignoring that imprint means missing a major part of the story. The research examines why some nations prosper while others struggle, and the answer, it suggests, is not just about capital or technology.
It is also about the norms and institutions that religion has shaped over centuries. Watch this space. If this line of research gains traction, it could fundamentally alter how policymakers and international development agencies think about the roots of prosperity.
The economists are not saying religion is the only factor — but they are saying it has been a persistent and underestimated one.