Church Membership and Social Insurance: Evidence from the American South

Abstract

We examine the effect of increased demand for social insurance on church membership. Our empirical strategy exploits the differential impact of the Great Mississippi Flood of 1927 across counties to identify a shock to the demand for social insurance. We find that flooded counties experienced a significant increase in church membership. Consistent with economic theories about determinants of membership of religious organizations, our result suggests that local churches provided ex-post insurance for the needy and in return gained new members.

Keywords: Religion, Informal Insurance, Club Goods, Natural Disasters

JEL Classification: D70, E20, H40