Religion in macroeconomics: A quantitative analysis of Weber's thesis

Tiago V. Cavalcanti, Stephen L. Parente, Rui Zhao

Research output: Contribution to journalArticlepeer-review


Max Weber in 1905 claimed that Protestantism, and more specifically Calvinism, facilitated the rise of capitalism. This paper assesses the quantitative plausibility of his hypothesis by introducing religious beliefs into a dynamic general equilibrium model of development and growth. Through counterfactual exercises, the paper investigates whether differences between Catholics and Protestants most closely identified with the Protestant Work Ethic can account for long delays in the start of Industrialization observed between various countries and regions. The main finding is that these differences may possibly explain why Northern Europe developed before Southern Europe, but they cannot explain why Europe developed before Latin America. Many of the tenets of Calvinism have had profound social implications-in particular, that thrift, industry, and hard work are forms of moral virtue and that business success is an evidence of God's grace. Because these views helped to create a climate favorable to commerce, Calvinism played a role in the overthrow of feudalism and the establishment of capitalism. Microsoft Encarta .

Original languageEnglish (US)
Pages (from-to)105-123
Number of pages19
JournalEconomic Theory
Issue number1
StatePublished - Jul 2007


  • Growth
  • Industrial revolution
  • Religion

ASJC Scopus subject areas

  • Economics and Econometrics


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