It has become fashionable for academic economists to argue that ‘culture matters’, and
that ‘hierarchical religions’ such as Catholicism and Islam hamper the development of
trust, cooperation and economic growth.
Recent historical research by Professor Kevin O’Rourke, published in the October
2007 issue of the Economic Journal, casts doubt on this view, showing that what at first
sight appears to be a clear link between religion and economic performance dissolves
when the political conflicts of the time are taken into account.
Looking at Irish dairying before the Great War, he finds that it was not Catholicism per
se that impeded the spread of cooperation among creameries within Southern Ireland,
but a history of sometimes violent political and economic conflict between two groups
divided not just by religion, but by class and political loyalties.
In the late nineteenth century, creameries using the newly-invented cream separator
technology could be run on either a private or a cooperative basis. By providing dairy
farmers with the right incentives, cooperatives ensured higher-quality milk supplies, and
the success of the cooperative movement was one of the main reasons for Protestant
Denmark’s economic success during this period.
Just over 80% of Danish creameries were cooperative between the mid-1890s and
World War I, about the same share as in the United States today. By contrast, just 39%
of creameries were cooperative in Ireland in 1906, and Ireland steadily lost market
share to her Danish rivals in this crucial sector.
Strikingly, in Protestant Ulster the proportion of creameries that were cooperative was
identical to that in Denmark: 82% in 1906. By contrast, in the three Catholic provinces,
just 28% were cooperative. Since cooperation required trust in one’s fellow farmers, this
seems a striking confirmation of the widespread view that Catholicism was inimical to
the development of trust and cooperation, with detrimental consequences for the
economy.
Such an argument, however, neglects the fact that in any society, religious affiliation
and other national, class or ethnic characteristics come bundled together, and that
different groups’ histories may vary in ways that matter. In the case of nineteenthcentury
Ireland, the 1870s and 1880s had seen a bitter dispute between largely
Catholic tenant farmers and their largely Protestant landlords over who should control
the land.
Such animosities were kept alive, even after the resolution of the ‘Land Wars’, by the
early twentieth century arguments between largely Catholic Nationalists and largely
Protestant Unionists over the constitutional future of Ireland. Despite the Irish
cooperative movement’s efforts to remain apolitical and non-denominational, the fact
that so many of its leaders were landlords meant that it aroused the hostility of many
Catholics.
Professor O’Rourke’s research shows that while creameries’ propensity to cooperate
was negatively related to Catholicism, this statistical relationship vanishes once
another, political factor is taken into account, namely the extent of violence during the
Land Wars.
Ulster had a higher share of cooperative creameries than the rest of the country, not
because of its Protestantism, but because of its history of more peaceful landlordtenant
relations, as well as its high share of small farms. It was not Catholicism per se
that impeded the spread of cooperation within Southern Ireland, but a history of
sometimes violent political and economic conflict between two groups divided not just
by religion, but by class and political loyalties.
Danish cooperation flourished as a result of that country’s homogeneity, not its
Protestantism. This homogeneity was in large part due to Bismarck’s seizure of
Schleswig-Holstein in 1864. When Ireland’s ‘1864’ occurred, with partition in 1922,
Southern Ireland was also left with an extremely homogenous population. Not
surprisingly, the propensity to cooperate there increased dramatically after 1922, the
population’s Catholicism notwithstanding.
The results of this study are consistent with the hypothesis that ethnic fragmentation is
harmful, which has surfaced in the context of current debates about African
development or the provision of public goods in US cities. They are inconsistent with
the argument that ‘culture matters’.
ENDS
Notes for editors: ‘Culture, Conflict and Cooperation: Irish Dairying before the Great
War’ by Kevin O’Rourke is published in the October 2007 issue of the Economic
Journal.
Kevin O’Rourke is professor of economics at Trinity College Dublin, and co-author (with
Ronald Findlay) of Power and Plenty: Trade, War and the World Economy in the
Second Millennium (Princeton University Press, 2007).
For further information: contact Kevin O’Rourke on +33-4-7926-2831 (email:
kevin.orourke@tcd.ie); or Romesh Vaitilingam on 07768-661095 (email:
romesh@compuserve.com).