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Religious Institutions and the Creation of Economic Societies

Manuel Mueller-Frank

University of Navarra, IESE Business School

July 20, 2013

This paper studies an anarchic society with a production technology where the allocation of goods is governed by strength. I establish the following results. First, the anarchic society is inefficient as no widespread adoption of the production technology occurs. Second, wide-scale production, and thus efficiency, is generally not achievable through a punishment mechanism that requires punishers to be stronger than the to be punished. Third, efficiency can be enforced on the other hand through a religious system with a supernatural punishment mechanism if it is sufficiently credible. This paper makes a new point regarding the crucial role that religious institutions with a doctrine of salvation and damnation could play in the transition from anarchic societies to those with enforceable property rights that enable production and subsequent economic development.

Number of Pages in PDF File: 42

Keywords: Property Rights, Anarchy, Supernatural Punishment, Religion, Religious Beliefs, Institutions, Neolithic Revolution, Partition Function Form Games, Dynamci Equilibrium

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Date posted: October 11, 2010 ; Last revised: July 27, 2013

Suggested Citation

Mueller-Frank, Manuel, Religious Institutions and the Creation of Economic Societies (July 20, 2013). Available at SSRN: https://ssrn.com/abstract=1684638 or http://dx.doi.org/10.2139/ssrn.1684638

Contact Information

Manuel Mueller-Frank (Contact Author)
University of Navarra, IESE Business School ( email )
Avenida Pearson 21
Barcelona, 08034
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