Financial Times, There is no evidence that Islam restricts economic growth, according to new research that casts doubt on the widely-held belief that Muslim societies are intrinsically less conducive to capitalism than those dominated by other religions.
The study, by Marcus Noland at the Institute for International Economics think-tank in Washington, reviewed growth in developing countries over the past few decades and found no evidence that countries with large Muslim populations grew more slowly, or had lower productivity growth.
Looking at growth within three religiously mixed countries – India, Malaysia and Ghana – only Malaysia showed statistically significant lower growth within its Muslim population.
“Islam does not appear to be a drag on growth or an anchor on development as alleged,” the paper concludes.
Excluding the effects of oil production, which dominates the Islamic Middle East, or studying Muslim Arab countries separately made no difference to the results. Conventional economic fundamentals such as the level of education and the share of investment and government in the economy – which were found to be unrelated to the prevalence of Islam – mattered far more for economic success.
“If one is concerned about economic performance in predominantly Muslim regions or countries, conventional economic analysis may yield greater insight than the sociology of religion,” the study says.
Mr Noland said his results aroused suspicion, bordering on disbelief, among colleagues when he first produced them.
The study, started just after the September 11 attacks on the US, “had a very long gestation because of that”, he said.
The view that particular religious affiliations affect growth has been a fertile ground for sociologists since the pioneering work of Max Weber, the German sociologist.
Some sociologists have argued that the tendency of Islamic education to rely on reiteration of a finite set of information, together with the disapproval of lending money at interest, has restricted innovation and growth in Muslim countries.
In contrast to the highly successful Islamic civilisations around the turn of the first millennium, the fact that Muslims are relatively poor in the modern world has reawakened interest in the links between Islam and economic success.
http://www.iie.com/publications/wp/2003/03-8.pdf
