This paper presents experimental evidence exploring how insurance might be a motive for religious donations by members of a Pentecostal church in Ghana. We randomize enrollment into a commercially available funeral insurance policy and let church members allocate money between themselves and a set of religious goods in a series of dictator games with significant stakes. Members enrolled in insurance give significantly less money to their own churches. At the same time, enrollment in insurance reduces giving towards other spiritual goods. We set up a model exploring different channels of religious based insurance. The implications of the model and the results of 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 community-based material insurance is also important and we hypothesize that these two insurance channels exist in parallel.
…. Our findings add to the literature on the economic functions of religious organisations by providing experimental evidence that a religious institution can be used as a substitute for a formal financial service in an environment where obstacles to the functioning of the formal market are high. Furthermore, the experimental findings add nuance to the literature on religious institutions as coordinating platforms by demonstrating that adherents might care as much about spiritual insurance (affecting outcomes through signalling to an interventionist God) as they do about material insurance (accessing transfers of goods and services from other church members).
The paper, of course, provides micro evidence of wider country-level correlations between income (which maps onto financial access) and religiosity.