Journal of Economic Behavior and Organization 21 (1993) 235-250. North-Holland Preaching matters Jody Lipford zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDC Presbyterian College, Clinton, SC, USA Robert E. McCormick Clemson Unioersity, Clemson SC, US.4 Robert D. Tollison George Mason University, Fairfax, VA, USA Received October 1991, final version received May 1992 1. Statement of the problem Moral character can be interpreted as a form of human or reputational capital, which people act to conserve and promote in market transactions because it is valuable. Unreliable behavior and immoral acts may lead to significant personal costs to the transgressor, as the vast literature on rent seeking and agency costs attests. Moral behavior will generally but not entirely be self-enforcing. Some moral rules will benefit the economy at large, even though the individuals adhering to them do not necessarily benefit directly from such behavior. For example, lectures about sexual abstinence may have impacts on the number of abortions, divorces, and illegitimate children, while not always being in the immediate self-interest of the recipients of the lecture. Historically, lectures on such subjects and rules regarding moral behavior have emanated from various sources. The family, for example, is a significant forum for lectures about moral behavior. And, of course, organized religion has been a fundamental institution in the promo- tion of codes of ethics and adherence to such codes. As such, the organized religion can be seen as producing a type of public good, which results from the moral guidelines inherent in its religious or theoretical beliefs. This, of course, is only an assertion or, better, an hypothesis, at least it is taken as such for the purposes of this paper. If the church preaches that stealing is immoral, does the rate of property theft Correspondence to: Robert D. Tollison, Center for Study of Public Choice, George Mason University, George’s Hall, 4400 University Drive, Fairfax, VA 22030, USA. 0167-2681/93/$06.00 0 1993-Elsevier Science Publishers B.V. All rights reserved