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Sect, Subsidy, and Sacrifice: an Economist's View of Ultra-Orthodox Jews

50 Pages Posted: 20 Sep 2000  

Eli Berman

University of California, San Diego (UCSD) - Department of Economics; National Bureau of Economic Research (NBER)

Ruth Klinov

Hebrew University of Jerusalem - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: August 1998

Abstract

The Israeli Ultra-Orthodox population doubles each seventeen years. With 60 % of prime aged males attending Yeshiva rather than working, that community is rapidly outgrowing its resources. Why do fathers with families in poverty choose Yeshiva over work? Draft deferments subsidize Yeshiva attendance, yet attendance typically continues long after they are draft exempt. We explain this puzzle with a club good model in which Yeshiva attendance signals commitment to the community. Subsidizing membership in a club with sacrifice as an entry requirement induces increased sacrifice, compounding the distortion and dissipating the subsidy. Policies treating members and potential entrants equally are Pareto improving. The analysis may generalize to other by increasing the stringency of prohibitions and sacrifice.

Suggested Citation

Berman, Eli and Klinov, Ruth, Sect, Subsidy, and Sacrifice: an Economist's View of Ultra-Orthodox Jews (August 1998). NBER Working Paper No. w6715. Available at SSRN: https://ssrn.com/abstract=226369

Eli Berman (Contact Author)

University of California, San Diego (UCSD) - Department of Economics ( email )

9500 Gilman Drive
La Jolla, CA 92093-0508
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National Bureau of Economic Research (NBER)

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Ruth Klinov

Hebrew University of Jerusalem - Department of Economics ( email )

Mount Scopus
Jerusalem, 91905
Israel
972-2-588-3140 (Phone)

HOME PAGE: http://micro5.mscc.huji.ac.il/~economics/facultye/klinov/klinov.html

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