DP14301 God insures those who pay? Formal insurance and religious offerings in Ghana.
This paper provides experimental support for the hypothesis that insurance can be a motive
for religious donations. We randomize enrollment of members of a Pentecostal church in Ghana
into a commercial funeral insurance policy. Then church members allocate money between them-
selves and a set of religious goods in a series of dictator games with signicant stakes. Members
enrolled in insurance give signicantly less money to their own church compared to members
that only receive information about the insurance. Enrollment also reduces giving towards other
spiritual goods. We set up a model exploring different channels of religiously based insurance.
The implications of the model and the results from the dictator games suggest that adherents
perceive the church as a source of insurance and that this insurance is derived from beliefs in an
interventionist God. Survey results suggest that material insurance from the church community
is also important and we hypothesize that these two insurance channels exist in parallel.