ABSTRACT
Israel is a fascinating site for research about political economy. The interpenetration of its politics and its economics is profound. In public-service sectors, economic pressures prevented the recruitment of new personnel to keep up with client demands, or forced cutbacks from existing staff. The physician, professor, and factory worker were likely to meet and gripe about their problems while serving in the military. No consideration of Israeli public policy can stray far from the issue of security. Parties are the stuff of Israeli politics, yet none has ever been able to overcome all the opposition and win a majority in a national election. The governments that are headed by finely-balanced political coalitions control the overwhelming proportion of Israel's economy. The pressures on Israeli policymakers are weightier than in other Western countries. Entrepreneurialism, indirection, and flexibility help to make things a bit more tolerable.
