Tuesday, April 6, 2010

Further evidence on the profit motive of churches

The Catholic Church is facing quite a lot of heat lately, to a large extend because it put the welfare of the organization far ahead of the welfare of its constituents. The Church denies this, of course. It is of interest here whether its other actions corroborate its social welfare motives.

Carla Marchese and Giovanni Ramello find an intriguing fact: since 2005, the teachings of the Pope are copyrighted. Copyright is like a monopoly in that it reduces quantity and maximizes private profits. Why would the Church adopt this model if it were trying to save as many souls as possible? The authors are gentle here and claim that the Church just wants to tax other media outlets that would make money by diffusing the Pope's message. I would not be that lenient. Indeed, this motivation only works if there is imperfect competition across media outlets, and then only under specific conditions. It is true that proceeds can be used to subsidize the Church's own publications, but seeing the profit margin of the Vatican's publisher (16%), it does not look likely.

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