The local embeddedness of ethnic entrepreneurship - over- and under-embeddedness in the Israeli Arab economy

The current pattern of industrial production in Israeli Arab settlements may be viewed as a peculiar form of peripheral industrialisation. It is peripheral in a number of ways: it is located in what is perceived as the national periphery; it specialises in old industries; it shows high dependence on local markets; and it had been integrated into the national economy under subordinating conditions. Nevertheless, industrial entrepreneurship is highly appreciated as important means for economic mobility, and a significant share of Arab entrepreneurs managed to break ethnic barriers and to access Jewish market. About half of them even succeeded in expanding into markets in the national core (Schnell et al., 1999).