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This short essay discusses the Weber-Sombart debate over the paternity of capitalism. In late 19th century Germany, a popular critical view held that capitalism was a product of Jewish culture, a fact that reflected poorly both on Jews and capitalism. Anti-Semitism and anti-capitalism were intertwined. With the Protestant Ethic and the Spirit of Capitalism, Max Weber set out to defend the market system by insisting on its Christian religious origins. This sparked a rather unsavory debate with his illustrious colleague Werner Sombart. In defending his position, Weber ultimately partitioned modern capitalism into a usurious, opportunistic element (derived from Judaism) and a productive, efficiency-driven element (derived from Christianity). What was directly at stake here was politics rather than social theory. The competing claims of Weber and Sombart were more about the legitimacy of capitalism than the socio-economic significance of religion. ..PAT.-Unpublished Manuscript [ABSTRACT FROM AUTHOR]

This paper draws on recently developed historical GDP estimates on five centuries of European economic growth (1500-2000) to revisit the Protestant Ethic thesis. After the Reformation, Protestant regions arose from the backwaters of Europe to displace the Catholic countries as the economic powerhouses. By 1700 - prior to the full-fledged industrial revolution - Protestant countries had overtaken the Catholic world in terms of income. A strong Protestant-Catholic income gap became well established over the next 250 years. There were no signs of convergence until the 1960s. This is not, however, a simple vindication of the "Protestant ethic" thesis. After discussing the empirical data, I explore a number of alternative hypotheses that might account for the economic dominance of Protestant Europe. They include (1) secularization - freeing the economy from religious controls; (2) the growth of education (and the Protestant emphasis on literacy - ability to read the bible); (3) the dismal consequences of the Catholic Counter-Reformation; (4) the importance of the Atlantic (slave) trade in creating an autonomous business class that would demand modernizing institutional reforms. ..PAT.-Unpublished Manuscript [ABSTRACT FROM AUTHOR]

When job loss occurs, income is not the only thing to suffer. Social status and respectability are central elements of the reward system in economic life. Drawing on the Panel Study of Income Dynamics, I use a Fixed Effects model to study the consequence of entering and exiting unemployment. After controlling for income loss, there remains a large social-psychological effect. Economic theory treats unemployment as equivalent to "time off work." However, these findings indicate that five weeks of unemployment is quite different from a 35-day weekend. The effect of unemployment is not uniform. In particular, people with family responsibilities find unemployment especially distressing. For those without such responsibilities, the effect of unemployment is smaller and only weakly significant. Rather than a generic "work ethic," there seems to be a "provider ethic." This seems like an important subtlety that has escaped sociological attention. It also suggests a modest way of improving the generosity of unemployment insurance, without sacrificing work incentives. [ABSTRACT FROM AUTHOR]

Do Unemployment Insurance recipients actively search for work? Do more generous benefits reduce search effort? This paper analyzes job search effort, using a unique data set of more than 300,000 administrative audits of UI job search records. Critics of the UI program focus on the disincentive of providing income support to the jobless. However, many unemployed people become discouraged, give up on the job search, and drop out of the labor market altogether. From this perspective, UI may be a support and a resource that helps to sustain job search commitment. The results show that 1) 95 percent of UI recipients maintain an active work search; 2) search effort declines over time, as jobless workers become discouraged; 3) generous UI benefits produce greater search effort; and 4) the positive effect of UI benefits on search effort is strongest among low-income workers (those with little savings or credit capacity to independently support rigorous job search). UI appears to support/encourage search effort among people who would otherwise drop out of the labor force. In other words, UI discourages labor force drop out, and helps to keep people motivated in the challenging search for a good job. [ABSTRACT FROM AUTHOR]

A key characteristic of medical markets is asymmetric information: patients do not know what is wrong with them, what their best course of treatment is, or which doctor is best trained to provide that treatment. This allows tremendous scope for opportunism on the part of medical providers, both for selling unneeded, invasive medical procedures, and for shirking on due diligence in treatment. If information problems are severe, a laissez-faire market setting will become a "market for lemons" (or a "market for quacks") [Akerlof (1970)]. We analyze asymmetric information in the context of hospital medical care. Using a large sample of US hospitals, we find that patients have limited ability to gauge the quality of their treatment. Raising the quality of medical care by 10 percent leads to only a 1.5 percent increase in patient satisfaction. In contrast, patients are more sensitive to "room and board" aspects of care: having a quiet room matters just as much for patient satisfaction as technical medical quality, and positive interaction with nurses has an effect size several times larger than medical quality. If hospitals compete on the basis of patient satisfaction, they will face an incentive to cut back on medical quality and invest in the more fleeting and superficial (but highly visible) aspects of care. This suggests caution in the push to reform medicine around free market principles. Better reforms may focus on strengthening professional ethics and, most importantly, insulating doctors from the financial incentives associated with different courses of treatment. [ABSTRACT FROM AUTHOR]