Of Credence and Collective Action: Religion's Comparative Advantages in Social Charity.

• Author: Gill, Anthony J.
• Position: Exploring the Philanthropic Landscape - Report

The provision of public goods to society has long been one of the dominant areas of inquiry within the field of political economy. Public goods include such overarching things as external security and the provision of domestic rule of law securing property rights (Buchanan [1975] 2000). Both external and domestic security possess the characteristics of (near) pure public goods, wherein their benefits are nonexcludable to all members of the community, are also nonrival in consumption, and require team production for some minimal level of efficiency. Given the free-riding problems arising from the nonexcludability condition, thinkers from Adam Smith and Thomas Hobbes to more contemporary public-choice theorists such as James Buchanan ([1975] 2000) recognize the need for a state to exist to coerce citizens into contributing to the provision of these goods. (1)

Over the past century and a half, coinciding with the rise of the welfare state, the concept of what constitutes a "public good" has expanded to encompass more targeted services that assist particular members of the community, including education for youth, food assistance for the poor, health care for the sick and disabled, and counseling services for individuals in emotional turmoil. All of the goods and activities noted here, however, have certain characteristics--namely, excludability and rivalness--that make them less-than-pure public goods, so that the justification for state provision of them becomes more contested. Nonetheless, these welfare programs are considered normatively part of society's collective responsibility, requiring some degree of cooperative effort on the part of those who can afford to assist those in need. The question that arises is whether private entities can adequately fulfill the social demand for these goods, a topic of inquiry that has gained more salience as welfare states have faced difficult fiscal crises (Pierson 1995).

With the so-called retrenchment of social welfare states over the past quarter century, (2) scholarly attention has turned to examining the role that nongovernmental organizations (NGOs), new social movements, and private-public partnerships play in delivering social welfare services to communities in need (see, e.g., Powell and Clemens 1998; Prakash and Gugerty 2010; Hein 2014). Many academics have focused on the rise of new social movements and NGOs, but others have argued that there are salient lessons to be learned by examining some of humanity's oldest and most enduring nongovernmental entities that provide structures of governance and supply needed social services--religious organizations (cf. Gill and Pfaff2010). For millennia, religious groups have provided critical goods such as education, orphanages, care for the elderly, and various counseling services that have benefited society. I argue here that religious communities are uniquely positioned to provide charitable goods and other crucial social welfare services to society given their ability to organize collective action not around the provision of social welfare per se but rather as a means of signaling the credibility of their core mission--the provision of salvation and other credence goods. Furthermore, the ability of local religious organizations (e.g., parishes) to solve collective-action problems can be harnessed for a variety of activities that enhance social welfare provision in local communities, adapting to local conditions and leveraging specialized community knowledge and skills. The argument is not that religious groups are better than government or secular NGOs with specific expertise in all or many cases, but rather that spiritual organizations offer a valuable complementarity to these other entities and avoid some of the common "public-choice problems" (e.g., rent seeking) that are endemic to government and specialized interest groups. Providing legal space for churches, synagogues, mosques, and other such institutions (3) to serve their mission enhances the overall efficient provision of social welfare in society.

Religion, Credibility, and Good Works: An Indirect Rationale for Social Welfare Provision

Although the social scientific study of religion receded during the middle part of the twentieth century in the anticipation that secularization was making the topic less relevant, the past few decades have witnessed a resurgence in interest in the topic (Philpott 2007). This resurgence has been due, in large part, to the simple fact that religion refuses to recede in social life and may very well be making a comeback everywhere outside of western Europe and (possibly) the United States (cf. Berger 1999; Jenkins 2011). (4) With this renewed academic interest in religion has come a reawakening to the political economy of religion, championed by such scholars as Rodney Stark (sociology), Roger Finke (sociology), Laurence Iannaccone (economics), and Carolyn Warner (political science) (Gill 2018). (5) This new scholarly focus harkens back to Adam Smith, who provided an extensive discussion of churches in The Wealth of Nations ([1776] 1976), noting that they both provided crucial social goods (801-2) and behaved in accordance with the self-interested principles that guide other economic actors (758-808). Understanding how and why churches provide public goods and why they have endured over millennia can further enhance our understanding of how social services can be delivered to needy communities without reliance upon state coercion.

Religious organizations principally have a comparative advantage in the provision of theological worldviews and ideas, which represent credence goods (see Iannaccone 1995). That is their primary comparative advantage relative to other organizations, including university philosophy departments. (6) "Credence goods" are so named because the quality of the good (or service) cannot be determined until some later date in the future, and thus the promise of delivery must be taken on the supplier's credible promise. Another way to say this is that the quality of the good must be taken "on faith." Insurance is the typical secular example given to illustrate the nature of a credence good: a consumer purchases an insurance policy on the expectadon that the policy will pay off in the event of a catastrophe. The promise of eternal salvation in the afterlife is the ultimate credence good in that it is impossible to determine the validity of that promise until it is too late to ask for one's money back. Beyond salvadon, clergy also provide other intangible goods, such as understanding of life's difficulties, philosophical (or theological) guidance on how to navigate those difficulties, and answers to questions about personal and social meaning--all of which are valuable things, as evidenced by parishioners' willingness to attend worship services, listen to sermons, and contribute resources to the provision of such goods.

The biggest challenge facing suppliers of credence goods is how to convince consumers that the promises of quality are credible; the providers must establish trustworthiness in themselves. Insurance agencies can point to past success in paying off policies, and a wide array of market and governmental institutions--such as independent ratings agencies, civil court systems, and "lemon laws"--have risen to reduce the uncertainty of various secular goods. But religious providers face a more difficult problem in that the goods they provide are immune from empirical verification or government regulation. With one major exception in Christianity, no individuals have come back from...