Does Religion Belief Matter to Self-Employment of Rural Elderly? Evidence from China

There is a growing interest in understanding the economic consequences of religious belief. Using unique dataset which surveys thousands of villages, this paper investigates the effect of religious beliefs on rural elderlies’ self-employment in China. The empirical results show that, self-employment is positively associated with religious beliefs after controlling for village characteristics, which implying that religion plays a significantly positive role in promoting self-employment of rural elderly since religious belief has influence on labor force market participation. We also find that, among the different religions, the promoting self-employment effect of believing in Buddhism and Christianity are more significant than Islam. However, believing in Taoism and native religion are negative and insignificantly affect self-employment. These results are consistent and robust after using instrumental variable approach, propensity score matching approach and controlling for the alternative hypothesis variables to re-examine. Our findings reveal that, elderly religious believers who are female, over 70 years old, work in the secondary industry and living in a village where soybeans/potatoes are the main crops are more likely to became self-employees. Mechanism analysis indicates that religious belief influence self-employment mainly through economic compensation channel because elderly people in rural areas believe in religion are due to instrumental rational rather than value rationality. Given the few studies and limited dataset resources in the context of rural revitalization in China, this paper put effort to provides new evidences of the relationship between religious belief and self-employment