@article{Michalopoulos:91008,
      recid = {91008},
      author = {Michalopoulos, Stelios and Naghavi, Alireza and Prarolo,  Giovanni},
      title = {Trade and Geography in the Economic Origins of Islam:  Theory and Evidence},
      address = {2010-06},
      number = {831-2016-55349},
      series = {GC},
      pages = {66},
      year = {2010},
      abstract = {This research examines the economic origins of Islam and  uncovers two empirical regularities. First, Muslim  countries, virtual countries and ethnic groups, exhibit  highly unequal regional agricultural endowments. Second,  Muslim adherence is systematically larger along the  pre-Islamic trade routes in the Old World. The theory  argues that this particular type of geography (i)  determined the economic aspects of the religious doctrine  upon which Islam was formed, and (ii) shaped its subsequent  economic performance. It suggests that the unequal  distribution of land endowments conferred differential  gains from trade across regions, fostering predatory  behavior from the poorly endowed ones. In such an  environment it was mutually beneficial to institute a  system of income redistribution. However, a higher  propensity to save by the rich would exacerbate wealth  inequality rendering redistribution unsustainable, leading  to the demise of the Islamic unity. Consequently, income  inequality had to remain within limits for Islam to  persist. This was instituted via restrictions on physical  capital accumulation. Such rules rendered the investments  on public goods, through religious endowments, increasingly  attractive. As a result, capital accumulation remained low  and wealth inequality bounded. Geography and trade shaped  the set of economically relevant religious principles of  Islam affecting its economic trajectory in the  preindustrial world.},
      url = {http://ageconsearch.umn.edu/record/91008},
      doi = {https://doi.org/10.22004/ag.econ.91008},
}