BinzelCarvalho IslamicRevival wp2016
The paper investigates the rise of the Islamic revival in Egypt from the mid‑1980s onward, linking it to a contemporaneous decline in social mobility among educated youth. Using the Egypt Labor Market Panel Survey (ELMPS06), the authors compare two birth cohorts – an “old” cohort (1949‑1960) that benefited from a guaranteed public‑sector employment scheme and a “young” cohort (1968‑1977) that largely did not. They document a sharp increase in educational attainment across cohorts, but a 18‑21 percentage‑point drop in the probability that university graduates from lower‑socio‑economic backgrounds obtain professional or formal sector jobs by age 28. This decline is concentrated among graduates whose fathers are not professionals, while those from professional families see no change. The paper then develops a behavioral‑economic model of religion in which individuals have reference‑dependent preferences: unfulfilled income aspirations (driven by a sudden fall in social mobility) increase the utility of religious participation as a coping mechanism. The model derives a necessary and sufficient condition – high income inequality combined with high expected mobility – under which a decline in mobility raises aggregate religiosity. It also shows a “living‑up‑to‑expectations” effect that can offset the coping motive. The authors further show that subsidizing education (lowering the cost distribution) amplifies the religious response because it raises aspirations. A dynamic extension adds a club‑goods component: religious capacity (the ability of organizations to provide services) evolves over time, creating multiple steady‑states and allowing a temporary mobility shock to shift the economy into a high‑religiosity basin. The paper concludes that the Egyptian Islamic revival was driven by educated middle‑class youth facing unfulfilled aspirations, and that similar mechanisms may operate in other contexts where development raises expectations while social mobility falters.
Topics
Empirical Documentation of Declining Social Mobility among Educated Egyptian Youth
Analysis of ELMPS06 data comparing old and young cohorts, showing increased schooling but a sharp drop in professional/formal employment for university graduates from lower‑status families.
Reference‑Dependent Model of Religion as a Coping Mechanism
Theoretical framework where individuals compare actual income to expectations‑based reference points; unfulfilled aspirations increase the utility of religious activity, formalized through a loss function with parameters γ and δ.