THE LEGATUM PROSPERITY INDEX™ 2016

Bringing Prosperity to Life

Israel

Ranked 40th of 149

At a glance

Ranks

40 th on the Legatum
Prosperity Index™

32nd
25th
24th
19th
9th
94th
91st
46th
133rd

SUB-INDEX RANKINGS

In the Prosperity Sub-Index rankings, Israel performs best on Health and Education and scores lowest on the Natural Environment sub-index.

Visit our Rankings table to see how Israel compares to other countries.

Prosperity Gap

The ‘Prosperity Gap’ takes a country's GDP and uses it as the yardstick to measure a nation's expected Prosperity Index ranking.

Israel has a small prosperity deficit. This size of Israel’s deficit is similar to Jordan’s, but much smaller than Iran, Iraq, or Lebanon’s. Israel has been unable to close its prosperity deficit, which has hovered around the same level since 2007.

Note:
In the chart above, each dot represents a country. The curve shows the general tendency with which prosperity increases as GDP per capita increases. If a country falls below the curve, then we can say that compared to all other countries, it is under-delivering prosperity for its citizens. Likewise, if a country rises above the curve, then we can say that it is over-delivering prosperity for its citizens. Learn more about the Prosperity Gap here.

Alternatively, have a look at the Prosperity Gap view on our Rankings table for a full list of countries and to see how each of them are performing on the various sub-indices.

Commentary

While Israel’s overall prosperity score sets it apart from its regional neighbours, there is one sub-index in which it bears similarity to those neighbours: Safety & Security. Its Safety & Security level ranks it above Iran and Iraq, but (quite far) below Jordan and Lebanon.

The breakdown in Israeli-Palestine peace talks in April 2014 was followed by escalating violence, including the deaths of Israeli and Palestinian civilians. These events largely explain Israel’s rank drop in Safety & Security from 49th in 2013 to 94th in 2016. Behind this aggregate drop are large increases in the number of terrorism related deaths and battlefield deaths. In terms of terrorism related deaths, Israel ranks among the worst countries in the world. Consequently, Israel’s political terror scale has heightened dramatically since the pre-2014 years. The deterioration in Safety & Security is also happening on an individual level: the proportion of people who have adequate shelter, while still very high, has declined between 2014 and 2016. Resolving this crisis is unlikely to happen soon and will continue to weigh down on Israel’s prosperity score.

Prosperity score (level of Prosperity) in Israel, its regional neighbours, and the EU
The average level of Prosperity in Israel places it closer to the EU than its regional neighbours.

Where Israel really pulls apart from its regional neighbours, and from the most other countries covered in the Prosperity Index, is in Health and Education, where it ranks 9th and 19th respectively. Israel is the only Middle Eastern country in the Health top 10. Healthcare in Israel is universal and participation in a medical insurance plan is compulsory. Israelis enjoy very high life expectancy at birth, high rates of immunisation against infectious diseases, and a mortality rate that has declined rapidly since 2007. Israel has managed to create positive health outcomes with healthcare expenditure at 8% of GDP (compared to 17.5% in the US, where health outcomes are poorer), nearly 40% of which is privately funded. Factors contributing to this efficiency, highlighted by the World Health Organisation in 2015, are regulated competition among health plans, controls on the supply of hospital beds, accessible and professional care, and a well-developed system of electronic health records. Recent reforms, like extending insurance packages to cover mental health care and dental care for children, and policy attempts at reducing healthcare inequalities, have also made for efficient and innovative healthcare delivery.

Israel is the only Middle Eastern country in the Education top 20. Youth and adult literacy rates are among the highest in the world and educational inequalities, as measured by the girls-boys enrollment ratio and educational outcomes inequality index, are among the lowest in the world. Israel education policy has acted to reduce education gaps by providing free early childhood education from age three to four, providing additional teaching hours to lower-performing students in Arabic, mathematics, and science, and by increasing the allocation of special care hours for disadvantaged populations, like new immigrants and Arab-speaking minorities in primary and lower secondary school.

Israel has many important characteristics of countries in the global top 20 of prosperity, healthcare and education provision being notable ones, but it has one important characteristic that makes it typical of its region: low levels of Safety & Security. If is Israel is to move up the prosperity rankings, then the Israeli-Palestine peace process needs to be the priority.


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Data

How to read this graph:
When comparing multiple countries on a spider chart, data points that appear
further away from the center represent a better performance to the points that are closer to the center.