The short- and long-term effects of the Six Day War on the Israeli economy

Ben Zion Zilberfarb

Research output: Contribution to journalArticlepeer-review

2 Scopus citations


This article examines the short- and long-term effects of the 1967 Six Day War on the Israeli economy. In the short run, the war led to a very big increase in aggregate demand (mainly military expenditures). This got the economy out of a Keynesian recession that prevailed before the war. There were several long-term effects. The French embargo on arms shipments to Israel, following the war, induced the development of a large military industrial base, which later became the basis for the impressive development of the high-tech industry. The influx of Palestinian workers into Israel depressed wages of unskilled workers, which slowed down the shift to more efficient production techniques (especially in construction). It also increased the dependency of the Palestinian economy on income earned by Palestinian workers in Israel.

Original languageEnglish
Pages (from-to)785-798
Number of pages14
JournalIsrael Affairs
Issue number5
StatePublished - 3 Sep 2018
Externally publishedYes

Bibliographical note

Publisher Copyright:
© 2018, © 2018 Informa UK Limited, trading as Taylor & Francis Group.


FundersFunder number
Stiftelsen Clas Groschinskys MinnesfondSF 16 107


    • Israel
    • June 1967 War
    • Palestinian workers
    • Six Day War
    • economy
    • high-tech
    • military industrial base
    • recession


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