Religion and Ethics

Citation

Galbraith, C.S. (2007), "Religion and Ethics", Journal of Enterprising Communities: People and Places in the Global Economy, Vol. 1 No. 2. https://doi.org/10.1108/jec.2007.32901baa.001

Religion and Ethics

Craig S. Galbraith Professor of Entrepreneurship and Technology Management, and the GlaxoSmithKline Faculty Fellow in Economic Development, at the Cameron School of Business, University of North Carolina Wilmington. He has published extensively in the areas of technology strategy and developmental entrepreneurship. Professor Galbraith's work in development entrepreneurship looks at entrepreneurial activity under extreme conditions, such as poverty traps and natural disasters. In particular, he is interested in the social capital and cohesion that emerges from religious beliefs and ethnic communities that leads to entrepreneurial success and economic growth. He has published six books, and over 100 manuscripts in journals such as the Strategic Management Journal, Academy of Management Journal, Journal of Business Venturing, Entrepreneurship Theory and Practice, Journal of Small Business Management, Journal of Small Business and Entrepreneurship, Journal of Management, California Management Review, and others.

Religion and Ethics

After having two manuscripts accepted early for publication in the Journal of Enterprising Communities I was asked to be the guest editor for this issue on religion and entrepreneurship. I am honored to take this role. As a background, the issue of religious beliefs, and their role in economic activity, entrepreneurial behavior, attitudes toward work and capital, and the formation of markets has been generally ignored throughout the disciplines of management and economics. While there was indeed a flurry of empirical research after Max Weber's original essays Die protestantische Ethik und der `Geist' des Kapitalismus was translated into English in 1930 as The Protestant Ethic and the Spirit of Capitalism, by the 1960s with the rise of modern neo-classical economics, with its “black-box” approach to firm behavior, interest in the more cultural and institutional aspects of firms and markets waned substantially. Recently, however, there has been a resurgence of interest in more behavioral aspects of firms and economies. This is partly due to the emergence of the business disciplines of entrepreneurship and strategic management, which by design focuses on the nuances of firm behaviors, and partly this is due to the more mainstream acceptance of institutional and property right approaches to understanding economic development encouraged by notable luminaries such as Harold Demsetz, Douglas North and the Peruvian economist Hernando de Soto.

But even with this, for the past two decades, most studies taking a more behavioral, sociological, and cultural approach to understanding economic activities still awkwardly strain to artificially ignore the topic of religion. I, for one, have always found this artificial avoidance of religious topics by modern academics strikingly odd. This silence is particularly disturbing when even a casual observer understands that throughout both ancient and modern history religion, faith, and belief structures have been one of the most important, if not the most powerful, force behind how culture, institutions, enterprises and even economies are formed, viewed, and maintained. Fortunately, just in the last few years business and economic researchers are beginning to seriously investigate these issues more deeply.

And it appears that some broad conclusions are emerging. First, religious tradition, faith, and belief structures do indeed make a difference in explaining entrepreneurial behavior, firm activity, and economic development. Second, religion is closely tied to the development of social capital, the creation of interpersonal trust, and the sustainability of ethnic and indigenous communities. And third, these forces are global in nature, although there are significant differences between religious traditions, geographic regions, and level of economic development. However, recent research has only scratched the proverbial surface of these important topics. This issue of the Journal of Enterprising Communities illustrates our increasing effort to understand the complex calculus between the forces that frame economic and firm behavior and the cultural and moral foundations that emanate from our notions of religion, spirituality and belief.

This issue offers seven stimulating papers, plus a book review. We lead off with a paper by Alex De Noble, Craig Galbraith, Gangaram Singh and Curt Stiles that looks at the impact of religious orientation on perceptions of market justice and entrepreneurial expectations. The paper raises an important, but often ignored issue. Does the religious belief structure of people impact their perceptions of market justice? And, in turn, do these perceptions impact various economic factors, such as self-employment and entrepreneurial activity? The paper offers a though-provoking finding – individuals that score high on intrinsic religious orientation are statistically correlated with negative perceptions of market-based justice. However, they are also more likely to desire an entrepreneurial path. The authors suggest that this may be an attempt to “internalize” the potential market-based externalities associated with their moral beliefs through strategies of self-employment. The results of this study are useful in understanding many of the “social economic” movements, around the world that seek to incorporate moral views of the marketplace in their economic activities.

The second paper by Lai Olurode explores the importance of religion on work, self-employment, and economic support among the Yoruba People of Nigeria. The Yoruba constitute an important ethno-linguistic community within Western Africa, with deep historical roots. Yoruba populations are found not only in Nigeria, but also Ghana, Benin, and Togo. In addition, there are significant immigrant communities of Yoruba found in the USA, Brazil, Cuba, and the Trinidad. The author takes the reader on a fascinating case study of the Yoruba, and the fundamental importance religion, beliefs and taboos have upon almost every important economic decision, including work ethic, choice of career, allocation of wealth, diversification of work skills, self-employment and market behaviors. The author provides a number of local Yoruba proverbs to illustrate this tight connection between religion, culture, and economic activities.

Sometimes a true understanding of the complexities of cultural issues can only be captured by an ethnographic approach. In the third paper, Leo Dana offers an ethnographic analysis of the Amish people in Pennsylvania, USA. The Amish are an offshoot of the Mennonites that first migrated to the USA in the late 17th century. Over time, they have developed a strong, close-knit local presence in several areas of the USA. The author immersed himself in the culture of the Amish, and in this paper, reports his observations. The paper details the power of networking, sharing a common culture, and the economic impact of employing cooperating strategies based upon high levels of social capital that accrues from a common faith and value set. In addition, the paper describes some of the modern pressures on the Amish community. The lessons from this paper are important when considering the issues confronting any well-established ethnic community that has strong religious and moral standards that define its economic activities.

The history of Ireland is a fascinating topic. Over the centuries the region has undergone dramatic economic and social cycles, with the Republic of Ireland in particular, leading a remarkable economic renaissance in the last decade. In the fourth paper, Emer Ní Bhrádaigh examines the historical development of social enterprises within the region. Examples are given from Catholic, Church of Ireland, Presbyterian and Quaker religious traditions in both the Republic of Ireland and Northern Ireland. In linking entrepreneurship with religion, this paper highlights the valuable role many religious entrepreneurs have played in social innovation. The author concludes that many of the foundations of the so-called Celtic Tiger lie in the pioneering work of previous religious entrepreneurs.

Peter Carswell and Deborah Rolland specifically examine the different religious practices in New Zealand, and their impact on entrepreneurial activity and business perceptions. They correctly note that as the world becomes more global and immigration increases, religious traditions subsequently become more intertwined and diverse within a country. Analyzing data from a sample of approximately two-thousand New Zealanders, the authors suggest that ethnic diversity and its associated religious value systems do not negatively impact business start-ups, and in fact, may enhance the level of entrepreneurial activity.

With almost complete certainty, any paper that looks at religion and economics inevitably references Max Weber, the early 20th century German economic sociologist. And most people are familiar with his most famous work, The Protestant Ethic and the Spirit of Capitalism. But it is surprising how often Weber's work is cited, but not really understood. In addition, although less well known, Weber studied a number of other world religions including Judaism, and the religions of India and China. Joel Ryman and Craig Turner's paper, titled “The modern weberian thesis: a short review of the literature” specially looks at Max Weber's contribution to understanding the link between religious tradition and economic activity on a global basis. It provides a concise summary of Weber's different hypotheses from his various works. The paper also examines some of the more important, post-1950 Weberian-based empirical research that has been published through-out the world.

While the global connection between economic development and religious belief has been seemingly well established by a number of recently published papers in economics, including several articles by the well-known Harvard economist, Robert Barro, the role of entrepreneurial activity is often lacking in these studies. In the last paper of this issue, Craig Galbraith and Devon Galbraith specifically investigate the mitigating effect of entrepreneurship, and the impact religious belief has upon entrepreneurial activity. In their study, the authors also rely upon other often-overlooked streams of research, such as the psychology of religion literature, the moral markets literature, and the economic theology literature. Using data from both the Global Entrepreneurship Monitor (GEM) and the World Values Survey the authors conclude that, while “intrinsic” religiosity does appear positively related to economic growth, entrepreneurial activity measured by both total early-stage entrepreneurial activity and opportunity-based entrepreneurial activity is a critical intervening component. Thus, “intrinsic” religiosity is highly related to entrepreneurial activity, and this, in turn probably leads to economic success.

Finally, Vanessa Ratten reviews an important book by J. Brown, titled Global South Asians: Introducing the Modern Diaspora. This book details the close tie between religious traditions and the business activities of immigrant South Asians throughout the world.

Craig S. GalbraithGuest Editor