The Rise of the Israeli Knowledge Economy and Challenges Ahead

Question 1

What are the characteristics of Silicon Valley?

Answer 1

Culture with high appetite for risk-taking; high degree of collaboration and teamwork; and distaste for hierarchy.

Question 2

How is Israel different than Silicon Valley?

Answer 2

Not as many large companies, companies are just getting off the ground.

Question 3

How many start-ups are formed annually?

Answer 3

Between 1,100 and 1,200.

Question 4

Do companies in Israel have a lot of sales?

Answer 4

No; rather, investing is betting on selling for a high price down the road.

Question 5

What is the result of Israeli companies being happy to sell and cash out?

Answer 5

No large names or brands because the technology is sold to big companies overseas.

Question 6

When a company is sold, are operations often moved overseas?

Answer 6

No, they usually remain in Israel and increase the number of employees.

Question 7

What are the hottest sectors in the Israeli technology sector?

Answer 7

Artificial intelligence; life sciences; cybersecurity; and automotive.

Question 8

What is the Hewlett-Packard Phenomenon?

Answer 8

Developing products in spare time in garage. This has changed now, as organizations are willing to give you space and financing. For example, companies like WeWork give seed money, and incubators help young money get off the ground with very little capital.

Question 9

Name a big deal that has occurred involving an Israeli technology startup recently.

Answer 9

Intel bought Mobileye for 15.387 million dollars in 2017.

Question 10

True or false? Research and development in Israel is mostly domestic companies.

Answer 10

False, multinational research and development centres is prominent, making up a quarter of the tech workforce and accounting for two-thirds of all research nd development spending.

Question 11

Why would companies choose to export rather than grow the business?

Answer 11

Political instability, as well as bigger companies not surviving in Israel.

Question 12

Israel has an economy of ___, not the economy of ___.

Answer 12

Innovation, business.

Question 13

Name some factors that led to the development of the Israeli knowledge economy.

Answer 13

Zionists, agriculture, World War II, educational development, Israel Defence Forces, immigration, and reaction to world trade.

Question 14

How did Zionism lead to the creation of the Israeli knowledge economy?

Answer 14

Nation created out of the will of the Zionists to create a Jewish state. They wanted to have something aside from farming; this was called the “Zionist Enterprise.” These people were goal and task oriented.

Question 15

How did agriculture lead to the creation of the Israeli knowledge economy?

Answer 15

Goal of returning to agriculture, and developing productive agricultural technologies.

Question 16

How did World War II lead to the creation of the Israeli knowledge economy?

Answer 16

World War II came around, and increased the industrial and knowledge base. Demand for military hardware pushed Israel from an agricultural to an industrialized country.

Question 17

How did educational development lead to the creation of the Israeli knowledge economy?

Answer 17

Technion in 1924, Hebrew University of Jerusalem in 1925, Weizmann Institute in 1934. Highest percentage of the population with post-graduate degrees.

Question 18

How did the Israel Defence Forces lead to the creation of the Israeli knowledge economy?

Answer 18

Army is inescapable part of Israeli life. 18 years old is an impressionable period of a person’s life. Huge role in developing technology. Expertise/focus is on electronics and communication. Israel found that it could not rely on outside suppliers for military equipment. Individuals that exhibit excellence in science and math are placed in Unit 8200, which is the Israeli version of the Massachusetts Institute of Technology, California Institute of Technology, and Harvard.

Question 19

What group is known to become the pillars of Israeli start-up sectors?

Answer 19

Students from Unit 8200 of the Israel Defence Force.

Question 20

Name some developments made by the Israelis with regards to military equipment.

Answer 20

Israel aerospace industries (Lavi, unmanned aerial vehicles, Arrow), Rafael (Iron Dome), Elbit systems (unmanned aerial vehicles, communications), Israel military industries (Uzi submachine guns).

Question 21

How did immigration lead to the creation of the Israeli knowledge economy?

Answer 21

Israel is a country of immigrants, valuable injection of human capital.

Question 22

How did world trade lead to the creation of the Israeli knowledge economy?

Answer 22

Governments privatized companies, de-regulated industries in an attempt to boost the economy. In 1993, the government set up funds for venture capitalists. As a result, it is a hyper-capitalist economy.

Question 23

What are the characteristics of start-up culture in Israel?

Answer 23

Distaste for hierarchy; high tolerance for risk-taking; culture of teamwork and group loyalty; and problem solving and task orientation.

Question 24

True or false? Israel struggles to sell their technology.

Answer 24

False, Israel has no issues selling technology.

Question 25

What works against Israel’s use of technology as a diplomatic tool?

Answer 25

Their politics and actions in Gaza and the West Bank.

Question 26

Name a country that Israel relies on in particular.

Answer 26

United States of America for trade and military technologies.

Question 27

Why doesn’t Israel look to Europe to form strong trade ties?

Answer 27

Europe is in a perpetual state of recession.

Question 28

Why are China and India desperate to come to Israel?

Answer 28

In hopes of finding technologies to deal with environmental issues and overpopulation.

Question 29

True or false? Israel is a member of the Organization for Economic Cooperation and Development.

Answer 29

True.

Question 30

True or false? Israel’s economic performance outpaces many Organization for Economic Cooperation and Development countries.

Answer 30

Somewhat true. The economy is growing because of rising birth rate and increasing population; however, Gross Domestic Product per capita is not growing, and labour productivity has worsened.

Question 31

Describe Israel’s problem with poverty.

Answer 31

Despite having a high technology industry, poverty is still an issue. Most people do not work in the technology industry, and other industries are heavily regulated and the cost of living is high. Israel’s economy is isolated and there are many monopolies and bad services.

Question 32

What is the demographics of Israel?

Answer 32

75 percent Jewish and 25 percent Arab.