Yeah. That's about when organized religion started to come about. Archaeologists have found evidence of religious behavior in pre-historic societies as well though in cave paintings, burial sites, totems, etc. A really interesting discussion can be had about the whole bit, partly because we don't know exactly what pre-historic man was up to and partly because it's easy to argue about how many items of religious elements and concepts you would need to have before something can be considered a "religion." Personally, I tend to think pre-historic practices count because I think that if we say that they don't, then we're saying that folk religions don't count as legitimate religions. Did you see the link I provided insomniasexx about The Moabite Stone? I love that little piece of rock. It really is a great piece of history that provides some insight into how the beliefs of older civilizations often tied in with their interpretation of current and political events. The Moabite Stone isn't the only artifact that illustrates this, but for some reason it's the easiest one for me to remember. Absolutely. For better or worse, religion really was a potent form of early propaganda.From what I understand, religion started around 10,000 BCE, right after the development of Agriculture. As villages formed, people needed a leader to guide them so that they can organize efficiently to survive and harvest crops, while fending off danger. Law (through religion) was created to keep order, and myths were created to explain how the world around the people worked.
This abuse of religion to gain power ensured the leaders who were keeping the villages organized a luxurious life. It may have also been used to convince people they invaded and captured in other villages, as kingdoms and empires formed. Religious significance = Power back in the day, as seen in Mesopotamia and Egypt.
I believe your point on group identity also falls under the above, like nationalism, even though they are being controlled by a leader, they get the feeling that they are special and are an important part of their society as they are taught so.