Economics and Church Growth

Until recently church growth research focused entirely on internal factors in the church. We are only beginning to understand how larger, outside conditions affect church growth. It is possible that our efforts to produce growth has less to do with the results than major demographic, cultural and economic trends or the specific social context of a given congregation or mission.

David Beckworth has recently produced a research paper that makes a significant contribution in understanding how church growth relates to macroeconomic developments. He is an economist at Texas State University. I first met him while he was on the faculty of the business school at Andrews University.

Entitled "Praying for Recession: The Business Cycle and Protestant Church Growth," the paper concludes that "there is a countercyclical component to the growth of Protestant denominations in the United States. ... Evangelical Protestants [are] particularly sensitive to the business cycle. During recessions their membership grew on average 1.52 percent annually, a significant pick up from the 0.98 percent growth rate in non-recession years." He found similar relationships to several specific economic indicators: unemployment, oil prices, real stock prices, and the yield curve spread. "A third of the variation in their membership growth rate could be attributed to changes in these macroeconomic indicators."

Beckworth was able to do quarter-by-quarter analysis of the data from one evangelical denomination, the Seventh-day Adventist Church. He found that "the countercyclical component of conversions lasts for about 1.5 years after a macroeconomic shock."

"The growth of mainline Protestant denominations was also found to be responsive to economic conditions. Just under half of the variation in the growth of mainline Protestant denominations could be attributed to changes in economic conditions," although they are "less countercyclical than the evangelical Protestant and even had a procyclical component to it."

You can click here to download a copy of the paper and Beckworth is looking for comments. He will be presenting the paper to an association of economists in early 2008.

Cynthia Woolever's new book (see book list on this site) provides another important look at the larger context of congregational life. And my publisher would be unhappy if I did not mention my own contributions in this regard: Mission in Metropolis (2007) and Understanding Your Community Third Edition (2006) by available from the Center for Creative Ministry.

Comments

[David Beckworth]

Monte:

Thanks for discussing my article in your blog. I have made some changes to the paper in getting it ready for an economic journal. Some of the changes are economic terms that may be foreign to some readers of your blog. So, for the sake of interested readers here are a few definitions that may be useful:

(1) Substitution effect: the idea that as wages increase there is more incentive to work more hours—pay me more and I will work more. Alternatively, the cost of not working increases.

(2) Income effect: the idea that as wages increase there is less incentive to work—the same amount of income can now be generated with fewer hours of work. Or alternatively, with higher wages one can afford to buy more leisure.

(3) Non-labor income effect: same implications as (2) but now the income comes from sources other than work— income from ownership of rental properties, dividends from ownership of stocks, government transfer payments.

(4) Wealth effect: the idea that as wealth increases there is less need to save and more freedom to spend. For example, the housing boom of 2003-2005 generated a wealth effect that led to increased consumption.

As a follow up to this paper, I am interested in seeing what happens to financial giving during recessions. I can think of two opposing effects. On one hand, individuals lose their jobs so giving falls along with income levels. On the other hand, individuals may decide to give proportionally more during a recession as a way to find favor with God. Also, the increased conversion rate during a recession implies a larger membership base for tithes and offerings.

Any thoughts?

[Christian]

This words are really appreciative that major demographic, cultural and economic trends or the specific social context of a given congregation or mission and thanks for informing and sharing on David Beckworth research paper it helps a lot in Church growth.