Religious competition

A new NBER working paper looks at Substitution and Stigma: Evidence on Religious Competition from the Catholic Sex-Abuse Scandal.

This paper considers substituting one charitable activity for another in the context of religious practice. I examine the impact of the Catholic Church sex-abuse scandal on both Catholic and non-Catholic religiosity. I find that the scandal led to a 2-million-member fall in the Catholic population that was compensated by an increase in non-Catholic participation and by an increase in non-affiliation. Back-of-the-envelope calculations suggest the scandal generated over 3 billion dollars in donations to non-Catholic faiths. Those substituting out of Catholicism frequently chose highly dissimilar alternatives; for example, Baptist churches gained significantly from the scandal while the Episcopal Church did not. These results challenge several theories of religious participation and suggest that regulatory policies or other shocks specific to one religious group could have important spillover effects on other religious groups.

So different religious denominations are substitutes for one another. That is an interesting result and not one I would have expected. I would have thought there would be "lock-in" when it comes to religion. But when the "price" of being Catholic, in terms of dealing with scandals, goes up the demand for other religious denominations goes up. How people substitute is also interesting, they seem to go for denominations which are very unlike the Catholic Church. I would have expected, if there was to be substitution, that it would be to similar denominations.