Research On Religion » waqf

Jared Rubin on Religion & Credit Risk in the Ottoman Empire (Encore Presentation)

tonygill — Sun, 05 Nov 2017 09:00:55 +0000

In celebration of the release of Prof. Rubin’s new book, Rulers, Religion, and Riches: Why the West Got Rich and the Middle East Did Not, we offer up this oldie but goldie from our archives. We expect to be hearing more from Jared in the coming months, so stay tuned!

When it comes to wielding economic power in society, and getting the best interest rates on loans, most people would expect that the wealthy and politically connected would be in a better position than others. While generally true, Prof. Jared Rubin – an associate professor of economics at Chapman University and associate director of the Institute for Religion, Economics, and Society – points to a very interesting period in Islamic history where this didn’t necessarily hold true. In fact, it was during the late Ottoman Empire that those in socially-disadvantaged positions were able to secure lower interest rates on loans than the rich and powerful. The groups paying lower rates on credit included women, the poor, and non-Muslims.

As Jared has been a guest on the show before, we open with a bit of banter about what he has been up to, which includes writing a new book and wrangling over the title of that book. Our conversation then jumps to a recent project with another RoR guest, Timur Kuran. Here, these two scholars take a look at how interest rates were set in the late Ottoman Empire (circa 17th and 18th centuries). Jared spends some time filling us in on what this period in Ottoman history looked like, with a survey of the legal, banking, and commercial system that was in place and how religiously diverse Istanbul and other parts of the empire was. This discussion also covers how women were able to accumulate wealth during this period of time, an important observation as females were part of the credit market in the Ottoman Empire. Jared explains the importance of interest in credit markets and how Islamic rules on usury operated.

The next step in our discussion covers how individuals with legal and financial power can often gain favorable access to credit, a result that is not surprising to most folks. However, we quickly learn that during the period under examination by Profs. Rubin and Kuran, the well-connected often paid higher interest rates than those in a less favorable social position. Jared points out that titled elites (i.e, the politically well-connected), Muslims, and men paid a premium on their loans relative to those not politically connected, females, and non-Muslims. He explains how Timur Kuran discovered this empirical oddity while conducting extensive archival research, and how both of them thought it was merely a problem with a small sample size or poor data recording at first. However, the more they examined the situation, the more it revealed a fascinating puzzle. Jared explains that because the politically well-connected and Muslims would oftentimes get favorable decisions from the court system when they defaulted, lenders would build in a small premium to manage this increased risk. Non-elites and non-Muslims (e.g., Christians and Jews) were less likely to receive favorable judgments in default hearings and thus were incentivized to be more careful in paying back their loans. He also notes that males had an easier time fleeing when it came time to pay back their loans, whereas women had fewer exit opportunities and were thus a lower lending risk. Our discussion explores the magnitude of these differences as well as the varying types of legitimate and illegitimate default.

The latter portion of our podcast explores why a similar pattern did not arise in Christian Europe as well as some modern extensions of this theory that take us to the land of Brazil and how this affects the ability of the poor to get apartments when renters’ rights are so strong. While Kuran and Rubin’s work on the Ottoman Empire seems to be a historical oddity, Jared notes that their findings fit nicely into our knowledge about credit risk today and could be useful in explaining financial results in other parts of the world or during other periods of time. We discuss some of the more surprising things he learned from this study including how going into empirical data with an open mind can often times prompt interesting theoretical questions, and how history is a good teacher. Recorded: February 17, 2016.

Note: Due to some phone issues, portions of the podcast had to be edited. We attempted to do this as seamlessly as possible.

Jared Rubin on Religion & Credit Risk in the Ottoman Empire

tonygill — Sun, 06 Mar 2016 09:00:09 +0000

When it comes to wielding economic power in society, and getting the best interest rates on loans, most people would expect that the wealthy and politically connected would be in a better position than others. While generally true, Prof. Jared Rubin — an associate professor of economics at Chapman University and associate director of the Institute for Religion, Economics, and Society — points to a very interesting period in Islamic history where this didn’t necessarily hold true. In fact, it was during the late Ottoman Empire that those in socially-disadvantaged positions were able to secure lower interest rates on loans than the rich and powerful. The groups paying lower rates on credit included women, the poor, and non-Muslims.

Note: Due to some phone issues, portions of the podcast had to be edited. We attempted to do this as seamlessly as possible.

Carolyn Warner on Religion & Generosity

tonygill — Sun, 09 Jun 2013 08:00:07 +0000

What motivates religious individuals to give, either of their time or money? And do such motivations vary across faith traditions? We look at the issue of generosity among religious communities with Carolyn Warner, professor of political science at Arizona State University, who reviews the findings of several studies she is conducting with co-researchers Adam Cohen, Ramazon Kilinc, and Christopher Hale. What makes this multi-faceted project so interesting is that, unlike previous studies that tend to focus only on Christian denominations in the U.S., Prof. Warner’s team compares Catholics and Muslims in four cities in Europe — Dublin (Ireland), Paris (France), Milan (Italy), and Istanbul (Turkey). In each city they survey and conduct some interesting experiments on both Catholic parishes and Muslim organizations. In other words, not only are the researchers examining Catholics in Ireland, but they make sure to study Muslims in that same city. Likewise, they find a Catholic population in Istanbul to compare as well.

We start with a discussion on the difference between charity and generosity, a difference that Carolyn and her co-authors find to be very important. Whereas the former term (charity) indicates a relationship that is vertical — between a “superior” handing down something to an “inferior” — the term generosity tends to be more horizontal in its meaning. Carolyn then talks about the general sociological issues involved in studying generosity, noting that individual and community giving represent a collective action problem and the acts of generosity can be viewed as either public goods or club goods depending on the target population of the generous acts. In general, club goods are directed towards members within the religious community (e.g., Catholics helping fellow Catholics in the parish), whereas the public good aspect of generosity refers to giving beyond the boundaries of one’s spiritual community (e.g., Muslims aiding non-Muslims).

We note that religion has always been attributed with generous giving and we review some of the general reasons why scholars believe religion has a positive effect. Carolyn mentions various aspects that have been explored in the past, including the role that community plays, the institutional setting, ritualistic behavior, heightened sensitivity to the plight of others that religious ideas impart, and theological exhortations to give. Given the inter-disciplinary composition of Carolyn’s research team, Tony asks how difficult it was for a social psychologist (Adam Cohen) and a political economist (Carolyn) to talk with one another and come to a mutual understanding of what might be at play in the act of generosity. Following this Carolyn explains the rationale for choosing the various research sites and the groups studied, including why the Gülen movement was chosen as the specific Muslim group to examine. This portion of the conversation encompasses the (supposedly) relevant differences in organizational structure and theology between Catholics and Muslims.

We then turn to the results of this study, focusing first on the findings from the semi-structured interviews. Carolyn notes how Catholics tended to frame their generosity in terms of “love of Jesus” and “love of others,” often pulling from Matthew 25:40, whereas Muslims tended to emphasize duty to God, noting that Allah had given individuals gifts and it was thus important to use those gifts to help others. We also discuss the differences in ritualistic giving behavior and how that motivates generosity within these two groups. Despite these differences, the research team discovered that both groups emphasize the “sense of community” as a motivational prompt for helping others. This sense of community is not only the desire to help others, but as with any other social organization, the desire to be with others. She also addresses whether or not these charitable activities were oriented towards in-group giving (i.e., club goods) or out-group (i.e., public good). This discussion is more nuanced than one might think with an interesting observation about Catholics in Istanbul and their socio-legal standing.

We finish with a discussion of the experiment that Carolyn’s team carried out. She describes the methodology and findings of the experiment. In addition to quirky problems that always arise when conducting social scientific research, the research team was surprised to find out that the Muslim participants did give their fee for participating in an experiment to a specific group, but not a group that they had initially anticipated. And if you are listening closely during this part of the interview you can hear Rocky J. Barkington, the official canine mascot of Research on Religion, providing some insightful commentary in the background. Carolyn then shares her broad-based conclusions regarding what the research team has found to date, including some thoughts on whether or not religious charity might substitute for government provision of social welfare. Recorded: May 29,2013.