Religion and the shadow economy

“Render to Caesar the things that are Caesar’s, and to God the things that are God’s. ” There is hardly a more prominent quote on the ethics of secular tax laws from a religious founder than Jesus ’ statement in the Gospel of Matthew (22: 21). Asked by the Pharisees whether paying taxes to the Roman emperor is lawful, Jesus points to the portrait and inscription on the coin and gives his famous reply. If statements like this were just of relevance for the internal ethical debates of religious communities, they would be without any economic relevance. However, religion leaves its mark on ethical convictions and thus may indirectly impact on economic preferences and behavior of its believers. Increasingly, the economic literature acknowledges the impact of culture in general and religion in particular on preferences and beliefs and, as a consequence, also on individual behavior. Examples are studies which search for an impact of religion on eco-nomic prosperity and education (Becker and Woessmann, 2008, 2009), on cor-ruption (Paldam, 2001), on macroeconomic outcomes, such as development an