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Global financial crisis: dharmic transgressions and solutions

  • Economics
  • Religious Science


Purpose – The purpose of this paper is to investigate the link between religiosity and labour market outcomes. Design/methodology/approach – Using the Ethnic Diversity Survey, the author: examines how religious belief and practice relate to earnings in Canada; considers the impact of the degree of religiosity using a composite index constructed by means of survey questions; and uses this index as an explanatory variable in the estimation of standard human capital-earnings function. Findings – A negative correlation between religiosity and earnings is found controlling for demographic, behavioural and human capital variables. Examining the cross-religion differential in earnings and human capital return, Muslims' earnings are found to be significantly lower compared to the average. Muslims' wage gap is explained by their immigrant status. Originality/value – This paper is the first to use a composite, score-based index standing for the degree of religiosity instead of a single survey question or unique observable indicator. Second, this paper is the first to consider the interaction of the degree of religiosity and religious denomination in a human capital-earnings equation. Third, the author considers both men and women, which previous Canadian papers did not do. Fourth, this study is the first on a high income country to consider Muslims as a distinct religious group. Fifth, the author considers the interaction of the effects of religion and of immigration.

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