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Most of this website understands that a) intelligence tests have predictive validity and b) that Ashkenazi Jews, as a group, have extremely high average intelligence. Given these two observations, one would expect the country with the most jews-per-capita, Israel, would have a tremendous amount of human capital. I would expect, knowing nothing else about the country, that industry there would thrive and the wages in that country should be among the highest in the world. But wages there aren't that high: the GDP per capita in Israel is broadly similar to an average European country like Belgium.
What could be the cause of this? Ashkenazi Jews make up around 2% of the US's population, but due to their high intelligence, worth ethic, and culture, have a large percentage of positions of power and prestige in the US. You would think that Israel, being 33% Ashkenazi Jewish, would have tremendous number of brilliant 130+ IQ middle-and-upper class, and I'd expect Israel to be a tremendous source of intellectual and economic might in the European region as a result (kind of similar to Singapore or Taiwan in Asia, but with even more economic and technological prowess).
What explains Israel's economic and technological mediocrity? The rest of Israel's demographics are largely Mizrahi Jews and Sephardic Jews, as well as 20% arabs. Mizrahi and Sephardic jews have around an IQ of 92-ish, whereas Arabs have an IQ around 80. Which means that, overall, the IQ for Israel is estimated to be around 92. But even still there are a lot of very bright people in Israel; it should really be a bigger economic powerhouse, but it isn't. Can anyone help me to understand why? Are international corporations just not leveraging these untapped intellectual resources properly? Or does the presence of some dumb people in your society prevent the 30% of the very-smart people from successfully starting businesses/reaching the level of international influence that they otherwise could?
tl;dr: Israel isn't a big economic superpower. Why?
The benefits of having lots of smart people compound slowly, and there are many factors militating against Israel - surrounded by relatively poor, hostile countries, a cultural standoffishness towards the rest of the world, a relatively low population, substantial amounts of that population sinking their time into scripture-gazing, and their position requiring them to spend a lot of their capital on military defense. It's unappealing as a destination for economic investment because of their controversies. The fact that they achieved what is a relatively high level of prosperity in the face of these headwinds is actually very impressive.
But I also think it's a trap to assume that high IQ is sufficient for economic success. There are plenty of high-IQ societies across the planet who, by historical contingency, were stymied - it is not any deficiency of intellect that holds the people of North Korea or Mongolia back.
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The simple (and seemingly obvious to me) answer is that Israel is not a big economic superpower because Israel is not very big. In terms of GDP per capita they are roughly on par with Germany (51,400$ in 2021 vs 50,800) which is pretty good all things considered.
More to the point, the correlation between IQ test scores and things like general intelligence, individual virtue, and economic success is no where near as strong as the IQ-fetishists like to pretend, and certainly not strong enough to overcome order of magnitude-scale differences in population, land area, and access to natural resources.
Or, in the case of Israel, the capacity for its neighbors to never miss an opportunity to miss an opportunity due to internal political dynamics that are in no small part driven by geographic and geological features that were old when homo sapiens were young.
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It’s my understanding that Israel’s Ashkenazim are disproportionately out of meaningful economic activity, either in the military or as Haredim who don’t work.
Not really. IDF has only 170k active personnel. Being in the reserve (600k ) doesn't prevent people from economic activity.
I'd say the big reason is they have to invest a lot in their own defense. At one point (1975), they were at 30% of GDP but right now it's just 6%, which is very high for a developed capitalist nation. But again, investments compound over time, the opportunity cost of having to go through 1970s spending 30% on the military was massive. Germany was spending a mere 3% of gdp in 1970s.
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Another metric worth looking at is Nobel prizes per capita.
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Look at their GDP growth.
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Well, Israel **does ** have the highest number of tech startups per capita in the world. With a population of 9 million, it has 97 unicorns compared to the UK's 65 million people and only 43 unicorns. And that's notwithstanding the UK's advantage in being an English-speaking country.
You also have to consider that an increasingly large share of the Israeli population (12.9% at the moment) are economically-draining Haredim, whose menfolk would rather spend all day studying the Torah rather than working. That shrink the economically active Ashkenazi population down a fair bit.
But I wonder if it's simply a case of time. Israel is a young country, and while there's a great deal of ruin in a nation, the corrolary of that is that it takes a long time to build a rich country. Given that it is only 74 years old, maybe Israel's future is a far richer one. Given their high birth rates, I certainly think it's a possibility.
There are many places where ~13% of the population are massive civic, cultural, and economic negatives. This is not a unique factor in Israel.
This is somewhat more so.
I don't think any other country has a large population of very intelligent, conscientious people who have huge numbers of children and whose menfolk are ideologically opposed to work.
Like sure, every country has an underclass (by definition, almost), but OP was asking why, in spite of high IQ Ashkenazim, the country isn't richer. I think the Haredim are part of that.
Is it going to last ? They've already made the go into the military.
At some point, it's going to have to go. As I hear they're not exactly the world's most charming and easy to get along with subculture,
Also, it's really not that dire, seemingly.
60% of men and 70% of haredi women are employed. But do post more if you find about their net fiscal impact for example.
https://en.wikipedia.org/wiki/Haredi_Judaism#Lifestyle_and_family
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What are you talking about, Israel is 40% Ashkenazi
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It's an economic power on par with the modern Netherlands. Both are too small to punch in absolute terms, but when scaled by population, they both rival Canada, a G7 member that punches well above its weight thanks to its proximity to the US.
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Politics: small countries need big friends for investment, trade, etc., and Israel is politically radioactive over the Palestine issue. Moreover, because all of Israel's neighbors in the region either actively despise it or grudgingly strike cynical realpolitik deals with it, it can't operate as a regional trade, manufacturing, or services hub the way other powerful small countries do.
Natural Resources: i.e., Israel doesn't have really any, and doesn't have the oomph to secure it's own supply chain from neighbors. This includes very important things like energy and water.
Geostrategic Considerations: Singapore controls one of the most heavily-trafficked shipping lanes in the entire world, as well as having British colonial legal traditions and political relationships, Chinese-diaspora economic acumen, and access to the cheap labor and developing natural resources of most of South-East Asia right next door. Israel is in a backwater part of the Mediterranean, with access to the Red Sea and the Horn of Africa thrown in as booby-prizes.
Security: Israel obviously is not in a great neighborhood, security-wise, and is also involved in at least three cold wars (Iran, Palestine, Lebanon) which could turn hot any moment. Thus, it is not an attractive target for investments in expensive, complicated, easily-damaged industrial plant, and has to devote far more of its resources to defense than comparator nationstates.
Social Unrest: Israeli politics and society are actually strikingly fractious, and significant portions of Israel's population think that economic activity is at best a second-place good to studying Torah and Talmud. Worse, because of the state's ethnic and religious affiliation, such groups have solid claims on public support for their underperformance.
Etc., etc.
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Compare the ages of the countries you're thinking of when you're thinking of Israel. The very fact that it exists was already a massive coup. And consider the world's opinion of the Mossad - of course, this is how legends are made, but they didn't even have to make a decades-long PR campaign about how awesome 007 is.
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I don't think US Ashkenazim have same IQ as Israeli Ashkenazim. Migration to Israel was subsidized, to US it was not. Also many people faked Jew ancestry to leave USSR. Old joke "A Jewish wife is not a luxury but a means of transport".
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I'm skeptical that the real IQ of Arabs is 80. Arabs where? Arabs in Israel? Also... Sephardic jews have an IQ of 92? I'm skeptical of that as well.
Probably a bit higher,however.. it could very well be that. Plenty of non-white or east Asian populations have an average IQ of 90. And in the middle east, it's worsened by their incestual marriage traditions.
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Let's start with the obvious - Israel defense as share of GDP dwarfs the rest of the world, it is very high even now and up until the dissolution of the USSR in historical times it was absurdly high. It is hard to accumulate compound interest on the capital you have when everything is poured into the goal of survival. So you can say that Israel had 30-40 less years of economic development compared to the rest of the first world.
Second - Israel is actually quite good at developing ip, NSO and the likes are absolute leaders in the industry. They just don't have the territory and the water to make big ticket heavy industry.
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Leverage. Let's say you drop an IQ 200 person into a small village in the Dark Ages. How much value would you get from their IQ? Not much. Now drop the same IQ 200 person into an aristocratic London family in the 1800s and you could be virtually assured of world changing discoveries.
The reason that New York Jews outperform Israeli Jews is that high IQ people in the United States can leverage a large unified economy with ample resources. Whereas high IQ people in Israel have fewer resources to leverage on average.
And as other commenters have mentioned, Israel still punches very much above its weight.
What indeed would happen to a Yankee in King Arthur's court?
It might be an interesting update, as people are so specialized in their training, I'm not sure how many could make even pre-modern tech once separated from modern supply chains.
The titular protagonist makes black powder, copper wire, magnets, guns, steam engines, and the tools to make those things etc from memory, what fraction of the people today can do that? My bet is well under 5%.
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I believe the 163x series is ongoing, among others. (First book is 1632 by Eric Flint; a small town from West Virginia in the year 2000 gets sent back in time to Germany, late 1631. Timeline divergence starts immediately.)
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Should do a movie where The Rock is dropped into medieval times. He believes his greatest asset is strength, so keeps going to battles. But he just casually points out seemingly common sense things, which inspire great leaps forward. Basically a time travelling Forrest Gump. Then when The Rock comes back to the future, society is extremely technologically advanced, but he's looked down on as a dumb brute.
A dumb brute with muscles, in the nerd society he paved the way for he is seen as an exemplar of the Medieval Man and academics quiz him thoroughly about his takes on the Bayeux Tapestry.
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Maybe the two axioms you have at the beginning aren't actually true. But even if they are, I'd be surprised if 'national intelligence' as a factor for economic success is enough to make a visible impact compared to much larger factors like population size, development, cranky neighbors, natural resources, or other regular international relations type stuff.
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This isn't really all that high, and many reports indicate that it is much more important than merely having high IQ people laying around when it comes to GDP. That plus it being so small means it loses out a lot on economies of scale. For example, military.
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Because that would be too obvious. The most successful Israelis accumulate wealth internationally and acquire power in non-monetary ways, and likely recognize the vulnerability of Israel's position and the benefits of keeping it weak in appearance.
In closer correlates of IQ that others noted, like research and technology, Israel is about as far ahead of its peers as you would expect. I'll add that Israel is the smallest country with an operating space program (that goes back to the 60's) and is the only program that launches facing west, against the rotation of the earth, to avoid flying over their friends in the middle east. This loses them about 30% fuel efficiency compared to everyone else.
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Israeli identity a bit weird since the nature of their citizenship means that it's relatively easy to flip between being Israeli foremost & being a citizen of another state foremost depending on your advantage.
Also large population of ultra-orthodox who don't really do anything productive economically.
Cca 65% of ultraorthodox adults are employed. That's really not particularly dire, especially given that they're not a very criminal population.
If omnipotent aliens asked eastern Europeans whether they'd be willing to swap their Roma (25-40% employment rate depending on country) encampments for Jewish ghettoes, I believe the answer would be very quick and mostly unanimous.
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People are still shooting rockets at them pretty regularly, they have less than 10 million people with not a lot of natural resources besides human capital to kickstart the whole wealthy micro nation thing.
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Just how good do you think those Ashkenazim ought to be?
Israel's economy is growing rapidly and is actually really good in several industries – they've famously got world-class military hardware and medicine, and they do have a ton of startups. Can't quantify this, but I'm seeing an exponential increase of high-profile AI papers from their universities, as of the last few years (though it seems they're getting spoiled by access to Google tech). Israel is also extremely good in high-tech spying, perhaps better than the US, as we've recently learned. They're doing all that without the US, the EU or East Asia around.
It may also be the issue of priorities. Israel is the only developed country with a developing country fertility, and not just because of the Haredim; the only one where nationalism and tradition coexist peacefully (for now at least) with modernity and tolerance; and the only functional ethnostate. Ashkenazim who don't find all that very attractive have an easy time moving elsewhere, but we shouldn't presume they're smarter than ones who stay and quietly keep building up Israeli might.
I predict Israel will be routinely classified as an economic superpower, or even just a superpower, by 2060s (in the not exactly very likely world where AGI doesn't flip the table, wiping out such extrapolations), when its population approaches or surpasses 20 million (current projections are still conservative).
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Because it has a population of 9 million people in a geographic territory the size of Wales?
Israel has a GDP per capita better than Germany's, or Japan's, and both of those nations are widely regarded as economic superpowers. Israel's geographic neighbors aren't even in its league. Anti-Israel sentiment in the Middle East and elsewhere also presumably plays some role in suppressing Israeli international trade opportunities. As near as I can tell, Israel is economically punching well above its apparent weight, exactly as your IQ analysis would seem to predict.
I'm not sure what else to say. You have picked two pretty inflammatory topics, presented only cursory evidentiary support for your claims, and then drawn a strong conclusion that does not appear to be at all supported by the facts you presented.
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To add some data: Israel isn't an outlier in terms of patents per capita or citations per capita either, ranking #16 in patents and #37 in citations.
Israel faces some pretty bad headwinds:
it's far from other developed countries
it exists with a perpetual risk of conflict, which makes it unattractive for investment
they spends 6% of their GDP on the military; mandatory military service taking ~6% of each person's career away
it has virtually no natural resources
That's a link to publications per capita. They might be higher or lower for citations.
Ahh, mea culpa.
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Israel has been fairly socialist for most of it's existence. They've done pretty well compared to other similarly socialist countries.
https://fee.org/articles/israel-the-road-from-socialism/
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Probably lack of scale would be my guess, Israelis too small of a market to launch tech firms and scale. You end up needing to do international business, language issue, and culture issues before the business has appropriate scale to afford those things.
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Check Nobel prizes; Israel is well over-represented.
Israel, with less than 10 million people, is not really likely to be an economic superpower. Not to mention its position surrounded by hostile countries and its lack of natural resources. Also the brighter Ashkenazim, realizing what a crap spot Israel is in, mostly moved to New York.
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