AStudy of Factors Influencing Urban Household's Religious Expenditures in Provinces of Iran

One of the portions of expenditures of people living in Muslim countries is religious expenditures. Such a behavior is undertaken with the aim of attracting God's pleasure or in order to gain Divine rewards. It is important to study such economic behavior of a Muslim society and the factors that influence it, from various aspects such as; economic, social and cultural.In this paper, we have evaluated the influence of real incomes of urban households as an economic factor, influence of inflation and unemployment rates, as socio-economic factors and influence of change in the attitude of executive managers [of the society] towards promoting religious expenditures through slogans, as a cultural factor. Effects of the mentioned variables over religious expenditures in 28 provinces of Iran were evaluated with the use of income-expenditure data of the households available with the Iranian Centre of Statistics, for the period of 1376 - 1387 (1997-2008) and through a panel data approach.Results of this study, based on the random effects model, indicate that real income of urban households and the change in attitude of executive managers towards promoting such expenditures have a positive effect on religious expenditures and are statistically significant. Unemployment and inflation have a predictable negative effect, but are not statistically significant.