Tyler Cowen thinks that Islam might be bad for economic growth. The relationship between religious beliefs and practices, on the one hand, and economic prosperity, on the other, is a very tricky question. It’s kept comparative sociologists busy for more than a century. Here’s one of the reasons why it’s tricky, courtesy of Ernest Gellner’s brilliant essay, “Flux and Reflux in the Faith of Men,” which can be found in his book Muslim Society:
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I like to imagine what would have happened had the Arabs won at Potiers and gone on to conquer and Islamise Europe. No doubt we should all be admiring Ibn Weber’s The Kharejite Ethic and the Spirit of Capitalism which would conclusively demonstrate how the modern rational spirit and its expression in business and bureaucratic organization could only have arisen in consequence of the sixteenth-century neo-Kharejite puritanism in northern Europe. In particular, the work would demonstrate how modern economic and organizational rationality could never have arisen had Europe stayed Christian, given the inveterate proclivity of that faith to a baroque, manipulative, patronage-ridden, quasi-animistic and disorderly vision of the world. A faith so given to seeing the cosmic order as bribable by pious works and donations could never have taught its adherents to rely on faith alone and to produce and accumulate in an orderly, systematic and unwavering manner. Would they not always have blown their profits on purchasing tickets to eternal bliss, rather than going on to accumulate profits and more? … Altogether, from the viewpoint of an elegant philosophy of history, which sees the story of mankind as a sustained build-up to our condition, it would have been far more satisfactory if the Arabs had won. By various obvious criteria—universalism, scripturalism, spiritual egalitarianism, the extension of full participation in the sacred community not to one, or some, but to all, and the rational systematisation of social life—Islam is, of the three great Western Monotheisms, the one closest to modernity.
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