DP10863 A big-picture socioeconomic perspective of Israel: the story of two nations in one

Author(s): Dan Ben-David
Publication Date: October 2015
Keyword(s): demographics, education, employment, growth, inequality, poverty
JEL(s): e00, e6, h00, j11, j21, o2
Programme Areas: Labour Economics, Public Economics, Macroeconomics and Growth
Link to this Page: www.cepr.org/active/publications/discussion_papers/dp.php?dpno=10863

One of the main challenges that economists have in relaying information to senior policy-makers without formal economic training is the conversion of advanced statistical analyses and technical language into clear, descriptive portrayals of core economic issues. In the vacuum that frequently exists, professional advocacy and lobbying providing one-sided perspectives often carries the day. Using Israel as an example, the purpose of this paper is to show how it might be possible to move the focus away from distracting short-term issues to strategically vital long-term ones, to shift analyses from cyclical behavior to long-run trajectories. Israel is a study in contrasts, and as such, much of the prevailing wisdom on the country is based on partial vantage points that often lead to misleading conclusions. It is a country facing existential issues that are primarily domestic and socioeconomic in nature rather than external national security threats as is more commonly perceived. It is also a country that still has time to adopt policies reflecting a turnaround in budgetary priorities – if it begins to comprehend the scope and magnitude of the long-run issues not currently on its national radar. The issues that Israel faces are not unique to the country. Many are present in one form or another in other countries that may soon have to deal with some of the major policy issues that Israel needs to address today.