What Role Does Religion Have in Shaping Human Consumption?

Abstract

Religious belief, as an informal social institution, has a significant impact on all aspects of human civilization. Previous literature has studied the effects of religious belief on economic growth, income, education, etc. Therefore, using the case of China as an example, this paper aims to investigate the effect of religious belief on human consumption. An empirical review of cross-sectional data from China’s 28 provinces reveals that religious belief has a detrimental impact on human consumption. Meanwhile, two-stage least squares and substituting the dependent variable (hc2) are employed to perform robustness tests. The new results also support the conclusion that religious belief negatively affects human consumption. In addition, this paper also discusses the heterogeneous effect of religious belief on human consumption in terms of geographical location, income level, and marketization degree. The results demonstrate the existence of the heterogeneous effect. Specifically, in the western area, low income level, and low marketization degree, religious belief negatively affects human consumption the most. On the contrary, in the eastern area, high income level, and high marketization degree, religious belief negatively affects human consumption the least.

Keywords

• religious belief
• human consumption
• two-stage least squares
• heterogeneous effect
• geographical location
• income level