Religiosity, economics and life satisfaction.

Publication: Review of Social Economy

Publication Date: 01-JUN-04

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COPYRIGHT 2004 Routledge

Abstract This paper uses a large individual data set from the Euro Barometer Survey (ICPSR 1993) to estimate the influence of religious phenomena on self-perceived satisfaction of an individual, controlling for macroeconomic conditions, effects of his political stance, and other socio-economic variables. Our estimated ordered logit model results show that an individual's life satisfaction is positively related to measures of strong religious attachment in the sense of being willing to commit to attending religious services frequently. Our other findings include that no strong evidence exists for the hypothesis that leftists suffer more from income inequality.

Keywords: Religious phenomena, self-perceived satisfaction, Euro barometer survey, ordered logit model

INTRODUCTION

Economists recently have begun to turn back to their roots in two areas: the study of the economic dimensions of religion and the exploration of human happiness. Their major "literature review" journal has recently published important pieces on each area (Iannaccone 1998 and Frey and Stutzer 2002b). Our purpose is to provide a contribution to the literature which interfaces between religion and happiness.

Economists have tended to focus on whether income or wealth produce greater happiness and their literature on religion, while diffuse, has tended to stress the potential material advantage of religious practice in reducing delinquent and criminal activity (Freeman 1986, Lipford et al. 1993, Hull and Boyd 1995 and Hull 2000). It was not always so. Adam Smith noted that religion prepares people "for another and better world to come" (Smith [1776] 1981: 778) and that its current life benefits are often clearly psychological and happiness inducing. So he wrote about the rural migrant's arrival in the city in the beginning of the industrial revolution. While such a migrant is initially "sunk in obscurity and darkness," often eventually his "conduct never excites so much the attention of any respectable society, as by becoming the member of a small religious sect" wherein he "acquires a degree of consideration which he never had before" (Smith [1776] 1981: 795).

Non-economists, however, have focused on a connection between religion and happiness. A recent survey is contained in Argyle (1999) and fairly recently Ellison (1991) has focused on the role of religious beliefs in happiness using American data. Our purpose is to supplement his contribution by focusing on European data and at the same time controlling for a variety of phenomena that economists have considered important determinants of happiness. At the same time, we want to question some conclusions that economists have reached while neglecting the role of religion. We do so by providing a brief review of the relevant literature in the next section. Section three spells out our model. It is followed by a description of our data. Section five presents and discusses our results. A concluding section follows.

REVIEW OF THE CONTRIBUTIONS OF ECONOMISTS TO THE STUDY OF HAPPINESS AND THE ROLE OF RELIGION

Since Frey and Stutzer (2002a, 2002b) and Alesina et al. (2001) spend considerable effort justifying subjective happiness research and showing that objective extra-personal measures of well-being correlated strongly with subjective happiness and much justification is provided in Kahneman et al. (1999), we will not do so. Nor shall we spend time on the voluminous literature on the "contradiction" that income increases happiness cross sectionally but perhaps not for the same individual across time (see Hollander 2001).

We merely mention several consistencies that Frey and Stutzer emphasize and several that they do not. The first is that at any point in time people with more income declare themselves happier or more satisfied. Another is that a person's own unemployment decreases happiness. A third is that political, economic and personal freedom apparently imply greater individual happiness. (1) Finally, they stress that macroeconomic conditions like inflation and overall unemployment may also affect individual satisfaction. Some consistencies they do not emphasize are that being female, age, (2) marital status and education are positive determinants of subjective well-being.

One of the important studies by economists (Alesina et al. 2001) also tests the hypothesis that income inequality is a public bad and reduces individual welfare as measured by subjective happiness. While they find no evidence for this in American data they do find that in Europe those with left wing political identification are negatively influenced by income inequality. (3)

One major study linking religion and subjectively assessed well being is cited by Iannaccone and appears in a social behavior journal. Ellison (1991) studies a small group of individuals in the United States who in the 1988 General Social Survey answered questions not only about the usual socioeconomic characteristics and membership in voluntary associations, and religious affiliation, but also question about recent traumatic events, (4) religious attendance, feelings of closeness to a divine entity (divine interaction) (5) and certainty of belief (existential certainty). (6) Holding age, sex, income, race, marital status, urban residence and region constant, Ellison uses ordinary least squares to explain life satisfaction. (7) The usual significant results apply but he also finds that some religious affiliations increase life satisfaction (8) and that belief in divine interaction increases satisfaction and that in times...

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