Economist Writing Every Day

Christians across the world are observing the season of Lent right now, concluding this week. This important period of religious observance involves personal sacrifice of some sort, and for Western Christians a common form of sacrifice is abstaining from consuming meat on Fridays during Lent. But there is one exception: most Christians allow consumption of fish on Fridays, in lieu of other kinds of meat.

But abstaining from meat on Fridays was not always a practice reserved for Lent. Catholics used to abstain from meat for the entire year prior to a 1966 decree by Pope Paul VI. This decree relaxed the rules on fasting and decentralized them. In the US, Catholic Bishops chose to eliminate meatless Fridays, except during Lent.

No doubt this was an important religious change, but it was also an important economic change. And the first question an economist would ask is: how did this impact the price of fish? In our simple supply and demand framework, this should result in a decrease in demand, which would lower the price of fish. Did that happen?

In 1968, economist Frederick Bell asked just that question in an article published in the American Economic Review titled “The Pope and the Price of Fish.” The short answer is that yes, the price of fish did indeed decline!

Bell gathered data for the Northeast US, which has both lots of commercial fishing and lots of Catholics. He collected monthly price data for seven kinds of fish for 10 years before the papal decree, and for several months immediately after the decree. The price of all fish species fell after the change in rules: just 2% for small haddock, but at least a 10% decline in price for all the other species.

In some sense, you might say this result is obvious, especially if you believe that Catholics were following the rules of the Church. And perhaps it is obvious! But economists today will note several interesting things about this paper.

First, it’s a very simple paper published in the top economics journal, the AER. It’s very short: less than 1,300 words. While it does use econometrics, it is a very simple model, an early version of what we now call difference-in-difference. And the paper is not trying to test some boutique theory: it’s just seeing if there is a decrease in demand, and how that affects price.

The background of the Papal decree is also interesting: the US commercial fishing industry had been struggling for years, and had even got the Federal government to assist the industry with the 1964 Fishing Fleet Improvement Act. While the paper doesn’t examine the impact on the industry in detail, it does suggest that the Papal decree probably further hurt this industry and some local fishing communities. A nice example of unintended consequences.

While a paper this short and simple would never be published in the AER today (nor any highly ranked journal), it’s a nice example to show to economics students today about the power of economic reasoning, using no more than our basic supply and demand framework.