Economic Policy Program
The underlying determinants of poverty and income inequality are inexorably related to the country’s rates of economic growth. The Economic Policy Program examines these issues from both long-run and short-run perspectives as well as from an international focus, separating between business cycle issues and factors that determine the placement and slopes of Israel’s long-run trajectories.
Three main vantage points are brought together in this chapter: (1) Israel’s relatively good economic performance in recent years – at least, in comparison with other Western countries that have still not emerged from the recession; (2) motivations for the wave of social protests that erupted in Israel in the summer of 2011, and; (3) the big picture, which is the primary one, incorporating the first two vantage points with additional issues, and framing them within long-run and international contexts. This third vantage point focuses on the very problematic trajectories that Israel has been on for decades and the state of some of the country’s primary infrastructures – human capital and transportation – that underlie these trajectories. Space limitations do not make it possible to provide a full exposition of all three vantage points here. However, the conventional socioeconomic discussion in Israel often makes it difficult to see the forest for the trees. Hence, the emphasis here is on a perspective from a vantage point far above, so that it will be possible to see, to understand, and to internalize the magnitude and the implications of the entire picture.
This paper appears in the Center’s annual publication – State of the Nation Report – Society, Economy and Policy 2011-2012.