Protecting Religious Freedom: An Asset to Iran’s Economic Reemergence

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Freedom of religion and belief is one of three factors linked with global economic growth according to a recent study by researchers at Georgetown University and Brigham Young University.[1] The study looked at GDP growth of 173 countries in 2011 and controlled for two-dozen different financial, social and regulatory influences. While a study such as this does not prove that religious freedom causes economic growth, it does suggest the relationship deserves more consideration. This study furthers the findings in The Price of Freedom Denied: Religious Persecution & Conflict in the 21st Century, which empirically demonstrated that restrictions on religious freedom create conflict, and further, an environment which is detrimental to business.[2]

Indeed, as Iran navigates away from decades of economic isolation and an economy dominated by its military-industrial complex, the protection of the right to freedom of religion and belief would be a clear asset in developing a robust and competitive private sector. For instance, the study by researchers at Georgetown and Brigham Young Universities finds a positive relationship between religious freedom and 10 of the 12 pillars of global competitiveness, as measured by the World Economic Forum’s Global Competitiveness Index (GCI).[3]

Specifically, where there are lower levels of government restrictions on religion (such as on religious broadcasting, conversion or preaching) and where there are low social hostilities involving religion (such as hate crimes, social coercion or sectarian conflict) economic competitiveness is high. For instance, strength in innovation is more than twice as likely to occur in countries where government restrictions on religion are few and/or social hostilities involving religion are low, as shown below.


Global Competitiveness Pillars and Religious Freedom

While this short article cannot go in to great detail, it can provide some observations about how the pillars of global competitiveness can be stimulated by religious freedom.

Primary Education & Health

Given the significant role religious groups play in providing educational and health services in many countries, it is not surprising that health as well as primary, secondary, and technical education is stronger in countries with more religious freedom and less religious hostility where religious groups are freer to provide educational and health services, which are often part of their core mission.

Technological Readiness & Innovation

Religious freedom contributes to technological readiness and innovation, which are stimulated by the ability of people to act freely and without fear of persecution for exploring new areas of thought. Indeed, a core component of religious freedom is that there is no religious board by which innovations and technologies must be passed; for example, there is no threat that communicating innovative ideas will carry a death penalty if considered blasphemous. This does not reduce the importance of religious norms and standards, but religious freedom implies that such standards are not enforced by a government or a religious authority. Rather, they are presented for professional deliberation by institutions with the relevant expertise and perhaps informed, as appropriate, by such moral codes.

Communications & Transport Infrastructure: Market Efficiency for Goods

The development of communications infrastructure is stimulated when there are no excessive restrictions on broadcasting and literature, or restrictions on freedom of movement, as are found in countries where restrictions to the right to freedom of religion and belief are rife. Similarly, governments that do not over-regulate religion tend to not over-regulate commerce-related to goods, making buying and selling easier and less burdened by unnecessary paperwork and bureaucracy.

Business Sophistication, Financial Market Development

Business sophistication, a measure of the quality of business networks and strategies, may be strengthened by a competitive religious economy. In such environments, religious groups engage in branding, marketing, distribution, and the production of unique products and services.[4] Indeed, while religion involves core spiritual dimensions, the service, publication, and outreach activities of religious groups provide large numbers of people with local examples of sophisticated networking and growth strategies. Similarly, financial markets benefit from these same civil strengths which religious freedom contributes to.

Institutional Environment Promoting Wealth

Indeed, it seems that religious freedoms may encourage ethical codes, as shown by the stronger relationship with the GCI pillar that also accounts for strong institutional environments which promote wealth. This pillar is captured in the GCI by measures of the absence of onerous governmental bureaucracy, overregulation, corruption (particularly in the area of public contracts), lack of transparency, and trustworthiness. The degree to which religious freedom fosters greater religious participation - which is certainly the case in countries like Brazil and the United States - also helps explain why religious freedom relates to a stronger institutional environment which ultimately promotes wealth.

Labour Market Efficiency

Religious freedom may relate to stronger labour market efficiency in various ways, including by allowing workers to achieve their most effective place in an economy which provides incentives encouraging efficiency and effectiveness free from discrimination based on their religion or belief.

Market Size and Macroeconomic Environment

When it comes to indicators that are associated with market size and the macroeconomic environment, the relationships are somewhat different. The dip in the economy in the West which triggered fiscal deficits may explain why only 11 per- cent of countries with lower government restrictions had strong macroeconomic environments. Finally, the data also shows that the markets are larger in countries with more government restrictions to freedom of religion and belief (such as China) and more social hostilities (such as India); However, on the basis of the other indicators of global competitiveness, size alone is not likely to ensure sustainable market growth. Indeed, larger markets with short-term growth potential without well-rounded pillars to support global competitiveness are likely to result in large-scale failures or shrinkages.

Finally, in addition to global competitiveness and economic growth, the research indicates that when freedom of religion or belief is put in to practice, it has the following effects:

  • Reduced corruption: Nine of the 10 most corrupt countries have high or very high governmental restrictions on religious liberty.

  • More peace: When religious freedoms are not respected, violence and conflict can occur, and normal economic activities become vulnerable with instability, with local and foreign investment driven away and sustainable development undermined.

  • Less harmful regulation: Some religious restrictions can directly affect economic activity, creating barriers for import and export industries, such as the halal food market. Examples range from the discrimination of women in the workplace (over religious dress, such as headscarves) to the use of anti-blasphemy laws to attack business rivals, as recently happened in the media industry in Pakistan.[5].

  • Reduced liabilities: Abercrombie & Fitch stocks dropped when news broke that the clothing retailer had allegedly refused to hire a Muslim woman wearing a headscarf, a violation of American equal opportunity employment laws.[6] By avoiding religious discrimination in the workplace, businesses can avoid such liabilities.

  • More diversity and growth: Freedom of religion can contribute to a rich pluralism that is itself associated with economic growth. For instance, the world’s 12 most religiously diverse countries each outpaced the world’s average economic growth between 2008 and 2012. Indeed, the active participation of religious minorities in society often boosts economic innovation. In China, during the Cultural Revolution of the 1960s and 70s, religion was outlawed and many people were persecuted for their beliefs. While it is true that China continues to regulate religion more strictly than other countries, current conditions are comparatively far freer. China is now home to the world’s second-largest religious population after India. Arguably, ensuring freedom for religious groups in China, Iran and elsewhere stimulates and sustains economic growth in the decades ahead.



[1] Brian J. Grim, Greg Clark and Robert Edward Snyder. “Is Religious Freedom Good for Business?: A Conceptual and Empirical Analysis.” Interdisciplinary Journal of Research on Religion, Volume 10, Article 4: http://www.religjournal.com/pdf/ijrr10004.pdf

[2] Brian J. Grim and Roger Finke, The Price of Freedom Denied: Religious Persecution & Conflict in the 21st Century, 2011, Cambridge University Press

[3] World Economic Forum, The Global Competitiveness Report 2013-2014, http://www.weforum.org/reports/global-competitiveness-report-2013-2014

[4] See Brian J. Grim and Melissa E. Grim, Forthcoming 2016, “The Socio-economic Contribution of Religion to American Society: An Empirical Analysis,” Interdisciplinary Journal of Research on Religion.

[5] Amnesty International, Pakistan: Ban of major private TV network is ‘attack on press freedom’, June 2014, https://www.amnesty.org/en/latest/news/2014/06/pakistan-ban-major-private-tv-network-attack-press-freedom/

[6] Marianne LeVine, Supreme Court rules against Abercrombie & Fitch in hijab case, June 2015, http://www.politico.com/story/2015/06/ambercrombie-fitch-hijab-case-supreme-court-ruling-118492

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