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Governing religion: the long-term effects of sacred financing

Bo Rothstein and Rasmus Broms

Journal of Institutional Economics, 2013, vol. 9, issue 4, 469-490

Abstract: The absence of democracy in the Arab–Muslim world is a ‘striking anomaly’ for democratization scholars. This cannot be seen as caused by religion as such, as there are now several democratic Muslim-majority states. Popular explanations such as values, culture, economic development, natural resources, or colonial legacy have been refuted. Based on Ostrom's approach regarding local groups’ ability to establish institutions for ‘governing the commons’, we present a novel explanation for this puzzle, based on historical variations in institutions for financing religion. In Northwestern Europe, religion and secular services managed by local religious institutions have been financed ‘from below’, creating local systems for semi-democratic representation, transparency, and accountability. In the Arab–Muslim region, religion and local secular services have been financed ‘from above’, by private foundations lacking systems for representation and accountability. It is thus not religion, but how religion has been financed, that explains lacking successful democratization in the Arab–Muslim world.

Date: 2013
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