Why Episcopalians and Jewish People are Richer
Religion is one of those topics that's unexplored when it comes to personal finance. If you surf the web, you won't find much discussion of it. If you read the Wall Street Journal or Investors Business Daily, you hardly see a mention of religion at all.
This is a shame. If you look at it, religion has played a defining role in much of human history. For example, religion was partly responsible for early European immigration to the United States, and historical differences between Christians and Muslims are an important subtext in our nation's current efforts in the Middle East.
But, what a lot of people don't understand is the impact of religion on patterns of individual wealth building. In this case, religion matters and it matters a lot. According to a great analysis by Lisa A Keister, Jews and Episcopalians are way ahead of the curve when it comes to building wealth. According to Keister, about 18% of Jewish and 12% of Episcopalian families have over a million dollars in networth, compared to only 2% of Baptists and 4% of Catholics.
What accounts for the difference? Synergy between belief and action. In the case of Jewish people the religion emphasizes the lack of an afterlife and places a high value on scholarship. In the case of Episcopalians the thinking is the old fashioned protestant ethic encourages thrift and investment. In both religions, spiritual beliefs and forms of social organization result in higher levels of home ownership, possession of savings accounts and stock market investments.
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Best,
James
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8 comments:
I'll stick with Catholicism, the religion that Jesus found, thank you.
Don't you mean Judaism emphasizes the afterlife? Though in the Orthodox version it's resurrection of the dead and not heaven as usually understood by Christians.
This was rather a poorly thought out post. I would assume, among many other things, that Catholics have 'less' wealth as a whole because there are so many - 1 billion last I heard - with many of them in developing countries. That would bring down the curve, no?
Aside from which, anyone who converts to ANY religion for the sole reason that they think it'll earn them more $$ is a souless idiot.
I'm hoping your post was tongue in cheek. Was it?
To add my two cents worth:
Another factor to consider is that the Muslim religion doesn't condone the concept of charging or earning interest. While this means that you won't pay interest on a loan, it really means that banks won't give you a loan in the first place because they don't have much of an incentive to do so without charging interest. It also means no interest on savings.
While I can see that point in saying that charging interest isn't a nice thing to do, it also means that many people loose out on opportunities to invest and be entrepreneurial.
Food for thought.
Miel
James posted on this and not myself, so he'll have to add more about where he got the info and so forth.
Yes, the comment on converting was certainly tongue and cheek.
You have a good point about catholicism having high numbers in developing nations. I think the only real way to look at the affects of religion would be to limit the scope to the US, as including the rest of the world would be difficult to get real stats on.
At the same time, numbers in the states may not be of much help, as the impact of whether they were practicing or not could make a difference.
All that being said, I do think that values and upbringing do make a big difference in how you look at money.
Cheers,
Miel
I'm pretty sure that James was referring to US only data. Islam is happy with equity not debt. So investors in the Muslim world can give you money but only will receive a dividend if you earn a profit. Debt where return for the investor is unrelated to return for the entrepreneur unless the entrepreneur goes bankrupt is a weird idea anyway.
I'm Jewish BTW :)
Leaving aside Jews, how about looking at the wealthy Episcopal phenomenon from the other direction: in the US at least, the Episcopal Church has long had a higher social cache than Baptist churches have-- so it attracts professionals in larger numbers. And because the Episcopal liturgy is so "high", it is a turn-off to Americans with less education... who not surprisingly also are less wealthy.
As for Miel's point about Muslims, you might want to check the figures on wealth among Muslims in the USA. I'm going from memory here, but I do believe that Muslims in the USA are at or above the US average in wealth-building. That being the case, showing how the religion impedes wealth-building provides a very useful explanation for a non-existent phenomenon.
(If on the other hand, we're interested in the phenomenon of poor Indonesians and Filipinos, or Algerians and Ethiopians, then we should note that only one country from each of these pairs is predominantly Muslim. Yes, clearly there are some poor Muslims in the world dragging down the average).
And by the way, do note that Lisa Keister's numbers are all about the USA-- and the Episcopal millionaire percentages break down when you add in Africans. For the same reason, slapinions is incorrect to suggest that a figure of 1 billion Catholics is somehow relevant to the 4% vs. 22% figures. Needless to say, if you throw all the Catholics in Latin America, Eastern Europe, the Philippines, and Africa into the mix, quite clearly the percentage of families who are millionaires is far lower than 4%.
Again, this is a story about America, not about the world.
Racists
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