Religion and Entrepreneurship

While considerable concern has emerged about the impact of religion oneconomic development, little is actually known about how religion impacts thedecision making of individuals. This paper examines the influence of religion onthe decision for people to become an entrepreneur. Based on a large-scale dataset of nearly ninety thousand workers in India, this paper finds that religion shapesthe entrepreneurial decision. In particular, some religions, such as Islam andChristianity, are found to be conducive to entrepreneurship, while others, such asHinduism, inhibit entrepreneurship. In addition, the caste system is found to influencethe propensity to become an entrepreneur. Individuals belonging to abackward caste exhibit a lower propensity to become an entrepreneur. Thus, theempirical evidence suggests that both religion and the tradition of the caste systeminfluence entrepreneurship, suggesting a link between religion and economic behavior...