Competition between Judaism and Christianity: Paul's Galatians as Entry Deterrence

type="main"> This paper sets forth a theory of competition between exclusive religions as an entry deterrence game, in which the incumbent may find it profitable not to accommodate but to deter the competitor's entry by precommitting to sufficient capacity expansion in the event of entry. If entry costs are high enough, deterrence is optimal and the incumbent remains a monopolist, although the entry threat distorts its effort upward. The model is then used to explain the Jews' withdrawal from proselytism in the face of Christian competition in the first century CE. We review the historical evidence on conversion to Judaism before and after the first century and argue that the demise of Jewish proselytism was due not to the destruction of the Second Temple in 70 CE but to the apostle Paul's strategic decision, in his letter to the Galatians, that Gentiles need not convert to Judaism to become Christians.