March, 2016

Was Adam Smith Right About Religious Competition?

  • Peter J. Boettke

    Director, F. A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics
  • Joshua C. Hall

    Associate Professor, Department of Economics, West Virginia University
  • Kathleen Sheehan

    Assistant Professor of Economics, Creighton University
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Find the paper at tandfonline.com. 

Adam Smith famously argued that increased competition in religion would result in more religious tolerance and that the benefits of competition in the marketplace would also be seen in religious instruction when many religious sects are tolerated. We use a cross-section of a maximum of 167 countries to explore whether increased religious competition results in less governmental regulation of religion and less governmental favoritism of religion. Our measure of religious regulation and favoritism comes from the Association of Religion Data Archives. Our empirical analysis also explores the influence of economic and political factors, including the size of the economy, openness of trade, legal origins, education, the amount of checks and balances on the government, and the role of democracy.