Working Paper: NBER ID: w25151
Authors: Samuel Bazzi; Gabriel Koehler-Derrick; Benjamin Marx
Abstract: This paper explores the foundations of religious influence in politics and society. We show that an important Islamic institution fostered the entrenchment of Islamism at a critical juncture in Indonesia, the world’s largest Muslim country. In the early 1960s, rural elites transferred large amounts of land into waqf —inalienable charitable trusts in Islamic law—to avoid expropriation by the state. Regions facing a greater threat of expropriation exhibit more prevalent waqf land and Islamic institutions endowed as such, including mosques and religious schools. These endowments provided conservative forces with the capital needed to promote Islamist ideology and mobilize against the secular state. We identify lasting effects on the size of the religious sector, electoral support for Islamist parties, and the adoption of local sharia laws. These effects are shaped by greater demand for religion in government but not by greater piety among the electorate. Waqf assets also impose costs on the local economy, particularly in agriculture where these endowments are associated with lower productivity. Overall, our findings shed new light on the origins and consequences of Islamism.
Keywords: Islamism; Waqf; Political Economy; Land Reform; Indonesia
JEL Codes: D72; D74; P16; P26; Z12
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| expropriation intensity (H13) | waqf land and Islamic institutions (Z12) |
| waqf land and Islamic institutions (Z12) | electoral support for Islamist parties (K16) |
| waqf land and Islamic institutions (Z12) | adoption of local sharia laws (K36) |
| marginal expropriable landholdings (Q15) | support for Islamist parties (P33) |
| waqf endowments (Z12) | local economy (agriculture productivity) (O49) |