Why Israel is an Innovation Leader?Yet Tough Times Ahead

by on April 19, 2008 at 12:00 pm

Gil Schwed had an intriguing answer: Israel began as an experiment in Jewish history. Innovation was built into the Israeli experience from the beginning.

Also technology development has always been a strategic component of the Israeli military advantage. That knowledge gets transfered to commercial applications better in Israel than anywhere else outside of the US.

Combine these factors with the influx of Russian engineers and scientists over the past fifteen years and Israel integration into the global innovation economy?Voila! You have the ingredients for successful innovation. Israel is considered to be the foremost region (after Silicon Valley) for technology R&D ?lots of venture capital, successful start-ups, attractive to many multi-national corporations.

However, there are clearly major problems Israel faces to sustain and benefit from these advantages:

  • The wealth is more highly concentrated among a few, while poverty and despair increases for many. The digital divide is a wide chasm in Israel.
  • The education system is deteriorating and the continuance of a skilled workforce for technology?essential for sustained economic development in attracting global business?may be seriously limited.
  • The Israeli confidence in themselves is lower. I spoke with a wide spectrum of Israelis from religious to secular, family, friends, and new acquaintances. Collectively they signaled to me they are not pleased with what is happening both within Israel and from without. To put some perspective on this, recently 81% of the American public thinks our country is going in the wrong direction; however, they are mostly happy themselves and have more positive confidence in their institutions than the Israelis seem to do. Many Israelis do not have trust in their government, Arab and Iranian hostile intentions, and believe the quality of life in Israeli society is declining.

While Israeli innovation is a bright spot, Israeli mood seems to be in a slump.

Passover is a season of moving to hope from despair, to freedom from slavery, and to strength from weakness. Perhaps we can also see innovation as a driving force for improvement with positive intent from Israelis collectively for themselves.