Faith-Based Economics

My, this story is disturbing.

Belief in Hell Boosts Growth: Fed Report
By Alister Bull

WASHINGTON (Reuters) - Economists searching for reasons why some nations are richer than others have found that those with a wide belief in hell are less corrupt and more prosperous, according to a report by the Federal Reserve Bank of St. Louis.

Researchers at the regional Federal Reserve bank acknowledged the importance of productivity and investment in the economic process but looked at some recent unconventional efforts to explain differences in national prosperity.

The St Louis Fed drew on work by outside economists who studied 35 countries, including the United States, European nations, Japan, India and Turkey and found that religion shed some useful light.

"In countries where large percentages of the population believe in hell, there seems to be less corruption and a higher standard of living," the St. Louis Fed said in its July quarterly review.

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The conceptual leap that the study takes in reaching this dubious conclusion is breathtaking and appalling at the same time. Though I haven't reviewed the study in detail, just on the surface it appears to abuse the transitive property (any undergrad enrolled in a statistics class can tell you that A=B and B=C does not necessarily mean that A=C), improperly equates correlation with causation, and includes the classic economist cop-out "All other things being equal" (contrary to the economist utopia, all other things are never equal).

It's bad enough that the architects of the monetary policy that is the backbone of our economic system can manipulate data so blatantly. But what is even more disturbing is that taxpayer dollars are being spent to promote religious belief on pseudo-economic grounds.