Why Germans Hate God (Part II)

In the first part of this post, I attempted to use some economic reasoning to shed light on one reason why Germany--and indeed most of Western Europe--is less concerned with religion than the United States. I explained that religion can be thought of as a good, which exists in a market of buyers (virtually anyone) and sellers (churches, or, more specifically, the clergy who run the churches). In a relatively free market, where churches receive no support from the state and thus must compete for congregations in order to survive, the incentives would be such that over time there would be many churches of many different religions available for the layman. In a constrained market where only a few religions were granted a large degree of monopoly power by the government, however, the competition and innovation would be stifled and relatively few alternatives would be available for the layman. At the end of my post I posed a few questions:

  1. Which market would breed more religious participation?
  2. Which of the two markets is more like  America, and which is more like Germany?

The answer to the first question is to me a no-brainer. A competitive market for religion would do a better job of not only building and maintaining demand for religion, but would also create incentives for more entrants on the supply-side. The end result is that a country with a free, competitive market would see far more religious activity than a country without such a market.

The answer to the second question, however, is not as straightforward as it might appear. America, while it currently has a religious market more like the first example, has not always been so liberal with regards to religion. Germany, on the other hand, has long allowed a larger role for the government in religious matters, and thus best resembles the second example.

Knowing that in fact America is more liberal in its allowance for the free practice of religion than Germany and has a more religious population gives some credence to the economic analysis, but what is more compelling is to examine how American religious activity has changed  over time as it liberalized its market for religion. During colonial times, America had a religious market similar to that of England or much of Europe; namely, each colony essentially had a "state" church that members of the colony were required to support with taxes and dues. This was done perhaps because it was simply how it had been done for centuries, and the argument was that if the government did not compel people to pay for churches, religion would simply disappear (This incidentally is a similar argument made for the continuance of other government monopolies like the post office).

As it happens, however, just the opposite occurred.  Around the time of the Revolution, there is reasonably good data that suggest 17 percent of the population were members of a church. When the Constitution was ratified, however, it created a free market for religion by banning state-established churches and allowing free worship. Instead of a dearth of religious activity occurring as many people predicted, America went through several "Great Awakenings" and membership has risen steadily to 34 percent in the mid-19th century and 60 percent today. Interestingly, however, it was the established churches that that did less well in the market, while the new religions like Methodism and the Baptists saw tremendous growth.

This negative relationship between regulation and religiosity hold true for international comparisons as well. Countries with higher levels of religious regulation have less religious populations, and vice versa. Thus, it seems quite clear that a large part of the difference in religiosity between Germany and America can be explained by simple economics. There are undoubtedly other factors both cultural and historical that can be pointed to as well for Germany's religious apathy, but there is no doubt in my mind that unfettered competition in Germany would unleash powerful incentives for religion to reinvent itself, expand into new directions, and win scores of hitherto agnostic converts.

The normative question of whether that would be a good thing is, of course, a different beast altogether.