“Religious Festivals and Economic Development”

The article subtitle is “Evidence from the Timing of Mexican Saint Day Festivals,” and the authors are Eduardo Montero and Dean Yang.  Here is the excerpt:

Does variation in how religious festivals are celebrated have economic consequences? We study the economic impacts of the timing of Catholic patron saint day festivals in Mexico. For causal identification, we exploit cross-locality variation in festival dates and in the timing of agricultural seasons. We estimate the impact of “agriculturally coinciding” festivals (those coinciding with peak planting or harvest months) on long-run economic development of localities. Agriculturally coinciding festivals lead to lower household income and worse development outcomes overall. These negative effects are likely due to lower agricultural productivity, which inhibits structural transformation out of agriculture. Agriculturally coinciding festivals may nonetheless persist because they also lead to higher religiosity and social capital.

My n = 1 experience in San Agustin Oapan (Guerrero, Mexico) is strongly consistent with this hypothesis.  Another factor is that the most talented individuals in the village typically are selected to fulfill leadership and ceremonial roles at the festivals, and that costs them a good deal of money (they are expected to pick up the expenses).  Those are precisely the individuals who might start small businesses and otherwise undertake beneficial commercial activities, but now they are starved of liquidity.


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