December 2010Assaf Razin: Biographical NotesI am the oldest of three children of my father, Mordechai (“ Mussia”) Berezin, and my motherDora Leibovitch. I spent the first 24 years of my life in my birthplace, Kibbutz Shamir; a ruralplace in the northeastern part of Israel. These personal biographical notes cover my backgroundfrom the young age at the kibbutz, through my graduate education at the University of Chicago, the firstacademic jobs, and the major turning points in my adult life. My professional life as an economist iscovered in detail in my vitae (see http:// www. tau. ac. il/~ razin). Against expectations that economists'CVs will slip into mathematical formulae by page five, this 50 page economist's bio does not slip into mathematical expressions at all.FAMILY BACKGROUNDI was born and bred in Kibbutz Shamir, in what was then the British Mandate Palestine. It was established in 1939 by a small group of mainly Romanian Jewish immigrants to Palestine, in a temporary place near Kfar Atta in the Haifa region. In 1944 it was relocated to a permanent place on the slopes of the Golan Heights, which tower 3,000 feet above the Upper Galilee. Indeed, before the border shifted east as a result of the six- day war in 1967, Kibbutz Shamir was at the most eastern border settlement in Israel. The Kibbutz system, though it spans a wide geographical area along the borders of Israel, has always been a tiny minority of Israel’s population. A relatively rare phenomenon can be observed from the kibbutz – a ‘sunrise in the west’. The kibbutz is nested in the steeply- rising western slopes of the Golan. When the sun rises, its first rays at daybreak illuminate the peaks of the Ramim mountain range across the valley to the west of Shamir. As the sun climbs progressively higher the more of Ramim is bathed in sunshine which can then be observed progressing from west to east, down the slopes of Ramim, across the valley and up the slopes of the Golan before reaching the kibbutz.The kibbutz (Hebrew word for "communal settlement") is a unique rural community; the fulfillment of Karl Marx’s idea "from each according to his ability, to each according to his needs". The first kibbutzim (plural of 'kibbutz') were founded some 40 years before the establishment of the State of Israel (1948). Their founders were young Jewish pioneers, mainly from Eastern Europe, who came not only to reclaim the soil of their ancient homeland (as is Zionism), but also to forge a new way of life. Today there are some 270 kibbutzim, with memberships ranging from 40 to more than 1, 000, scattered throughout the country, mostly in the periphery. The proportion of the kibbutz population within the Israeli society declined from 6.5% in the 1948 census to 3. 3% in 1972. At the end of the year 2002 the kibbutz Population numbered 115,600, living in 268 kibbutzim, and it constituted 2.1% of the total Jewish population in the country.The kibbutz movement is almost a century old. In a society in which there is no effective central government, as was essentially the situation of the Jewish community in Palestine until Israel gained statehood in 1948 (and even afterwards, in frontier regions exposed to Arab terrorism), smaller groups will form for self- defense and the provision of other public goods, such as social insurance. Collective ownership and wage equality are waysof protecting each member of the collective from economic and other hardships; "from each according to his ability, to each according to his needs"-- the communist slogan implemented successfully in the classic kibbutz-- is then a method of social insurance. As Judge Richard Posner notes, “In trying to weaken the bond between parents and children, the founders of the kibbutz movement, echoing Plato, who in his sketch of an ideal communist state in the Republic had advocated the communal rearing of children, were acknowledging that parents' instinctual desire to advance their children was inconsistent with communal equality.” The proportion of the kibbutz population within the Israeli society declined from 6.5% in the 1948 census to 3. 3% in 1972. At the end of the year 2002 the kibbutz population numbered 115, 600, living in 268 kibbutzim, and it constituted 2. 1% of the total Jewish population in the country. A best seller 1942 novel by Artur Koestler (who is known for “Dark at Noon”, one of the first to put cracks into the communist utopia), “thieves in the night” , describes first- handedly the first phase of the Kibbutz system (on the transformation of the Kibbutz system over the century since it stated, see later in this bio).I was 7 in 1948, the year of the Arab- Israeli war that followed Israel’s establishment as a state. The Kibbutz was then at the forefront of battles for the existence of the finger- of- Galilee region of the new Jewish state. All the women and children of the Kibbutz were evacuated into the relatively safe place of Haifa. We returned to the Kibbutz at the end of the War.(On May 15, 1948, one day after the creation of the State of Israel, the Arab armies of Egypt,Syria, Jordan, Iraq, Saudi Arabia and Lebanon invaded the new Jewish state. The war was markedby long periods of fighting and temporary cease- fires. Finally, fighting officially ended in January1949, at which time Israel held the 5,600 square miles allotted to it by the UN partition plan plus anaddition 2, 500 square miles. Jordan held East Jerusalem and the West Bank, and Egypt held theGaza Strip. From January to July 1949, armistice agreements were signed with Egypt, Lebanon,Jordan and Syria based on some minor variations of the frontlines as they were at the end of thefighting.)My father, Mordechai (“ Mussia”) Berezin was born during the beginning phase of World War I in Kishenev, the East European city in what is now the Republic of Moldova.(In the then Czarist Russian city, in April 1903, a three- day pogrom led to forty seven Jewishdeaths- men, women and children- and more than seven hundred houses had been looted. In thesame city in October 1905, nineteen Jews were killed. Jews around the world were outraged by thecontinuing attacks. After these pogroms at Kishenev, the Hebrew Writers Union of Odessa sent the30- year- old poet, Hayyim Nachman Bialik, who became later Palestine Israel's national poet, tocollect eyewitness accounts from the survivors. Bialik then wrote the famous poem “City of Slaughter”).My father made alyah (“ to ascend” in Hebrew; this is how we describe in Israel the immigrationby Jews from the Diaspora) in 1937, before World War Two. In the 1950s it became fashionableto switch from Diaspora- type to Hebrew- type last names. Our family name became Razin (“ secrets” in Hebrew; in the Hebrew alphabet it is as close as you can get to the original European name Berezin).The name, Berezin, perhaps indicating our ethnic origin, is derived from a Russian word Berioza, a white- trunk tree. Leo Tolstoy’s “War and Peace” describes an historical site, Berezina, from which, perhaps, my father’s last name Berezin has been derived . Berezina became famous when Napoleon was driven back by the Russian Army. The French army melted away at the uniform rate of a mathematical progression; and that crossing of the Berezina about which so much has been written was only one intermediate stage in its destruction, and not at all the decisive episode of the campaign. If so much has been and still is written about the Berezina, on the French side this is only because at the broken bridge across that river the calamities their army had been previously enduring were suddenly concentrated at one moment into a tragic spectacle that remained in every memory, and on the Russian side merely because in Petersburg— far from the seat of war— a plan had been devised to catch Napoleon in a strategic trap at the Berezina River. Everyone assured himself that all would happen according to plan, and therefore insisted that it was just the crossing of the Berezina that destroyed the French army. In reality the results of the crossing were much less disastrous to the French— in guns and men lost— than Krasnoe had been, as the figures show. The sole importance of the crossing of the Berezina lies in the fact that it plainly and indubitably proved the fallacy of all the plans for cutting off the enemy’s retreat and the soundness of the only possible line of action— the one Kutuzov and the general mass of the army demanded— namely, simply to follow the enemy up. The French crowd fled at a continually increasing speedand all its energy was directed to reaching its goal. It fled like a wounded animal and it was impossible to block its path. This was shown not so much by the arrangements it made for crossing as by what took place at the bridges. When the bridges broke down, unarmed soldiers, people from Moscow and women with children who were with the French transport, all— carried on by vis inertiae— pressed forward into boats and into the ice- covered water and did not, surrender.My father was one of the founding members of Kibbutz Shamir, and he lived there for the rest of his life. Soon after his arrival in Palestine, World War Two had erupted. The Jewish community in Palestine established a unit, the “Jewish Brigade”, to fight the Nazis. (Winston Churchill formed a separate Jewish Fighting Force, which would fly the Jewish national flag, within the British army. The Jewish Brigade Group of the British army, which fought under the Zionist flag, was formally established in September 1944. It included more than 5, 000 Jewish volunteers from Palestine organized into three infantry battalions and several supporting units. ). Because the Jewish community in Palestine had no full- fledged draft, the Jewish Brigade was based entirely on volunteers. But the Kibbutz system was based more on putting moral suasion on its members to volunteer; rather than letting the members to exercise their own individual choice. The Kibbutz chose two of its members “to volunteer” to the military service, and one of these happened to be my father. Being extremely loyal, he accepted the collective decision and loyally went on to serve the 4- 5 year period: first in North Africa (where General Montgomery fought the strong German army under Rommel) , and then in Italy and Germany. I can still read the postcards he sent from training in Mount Carmel, Cairo, Italy, and Germany. The Jewish Brigade entered Europe through Italy, where the famous battle in Monte Cassino was fought. (There were four separate and distinct ‘battles’ of Monte Cassino during late 1943 and early 1944, each one being immensely costly in Allied lives. In their turn, Americans, Indians, British and Poles reached the summit of Monte Casino but found it impossible to retain a hold for long. The destruction wrought of the world- famous monastery on the summit of the mountain was but part of the damage that occurred during this period. The campaign to take Monte Cassino was one of the most dramatic of the Italian campaign.) This is how Vikram Seth, the author of Two Lives, describes the battle, where is uncle, Shanti uncle, lost hisarm.” Two major roads lead northwards from Naples to Rome: one along the coast, the otherin the road skirtsthe towering mountain of Monte Cassino and then moves towards Rome along the Liri valley. Four attempts were made between January and May 1944 to advance past Cassino into the Liri valley. The first battle was adisaster. The germans brought in reinforcements from north of Rome to contain the beachhead. Every move along a “Snakehead Ridge”, as the American dubbed it, could be viewed and countered from the surrounding highest, all of which were in German hands. Two nights later, the New Zealanders at great cost captured the railway station at Cassino- a position that would have helped the British army make a break past Cassino into the Liri valley. But the battalion was forced by German tanks to relinquish their gains the following day In February it was decided to attack Monte Cassino the third time. Cadstle Hill and the first bend were taken bythe New ZealandersUncle Shanti was in Cassino area for several months.”) Amazingly the letters he sent from the front were written in almost perfect Hebrew, despite his being “OlehHadash” (new migrant). This was due to the Hebrew High School he attended in the Diaspora. During thewar he managed somehow to do a lot of serious reading on his own. He was fascinated by ancient history. This helped him later to put himself on a successful track and became a self- taught biblical scholar. With the end of the war, and the smashing defeat of the Germans, he returned to the Kibbutz. I still remember the enthusiastic reception given to him when he returned by the members of the Kibbutz and the big celebration of the victory over the Nazis. The Kibbutz members recognized his special intellectual talents and the general assembly assigned him to be the first high school teacher of the Kibbutz. For this purpose he studied in the Kibbutz Teachers’ College in Tel Aviv (“ Seminar Hakibutzim”). But unlike a University college the seminary had no exams, and granted no diploma. A diploma was not needed to work as a teacher in the Kibbutz. Studying in the Faculty of Humanities in the Hebrew University was not an option for him because the Hebrew University did not subscribe to the Marxian dogma, which had dominated the intellectual intercourse among the Kibbutz members. Possibly this also helped the Kibbutz to limit the outside options of its members, so as to prevent desertion. There were very insightful broad thinking teachers in the “Seminar Hakibutzim”. Because at this time in Israel there were very limited number of academic positions were available in the only one university in the country. On the supply side, though, they were drawing from a pool of many highly educated and talented people. The Hebrew University, the only university in Israel at the time, had only a very small faculty; only of a few hundred academic staff (compared to 10,000 today). It was also established as an institution of higher learning and research after the German university model: a few permanent professorship positions and teachingassistants with only temporary positions. Many bright, highly educated historians, literature scholars, etc.had no other choice but to pursue semi- academic careers. By default, they had to choose teaching careersin high schools and seminaries. These institutions obviously benefited from having a select group of teachers of a high caliber. For example, a teacher in Seminar Hakibbutzim, who had a great influence on my father, was Zvi Yavetz. Zvi, the internationally renowned historian of the Roman period, was a Hebrew University Ph. D. student at the time. (In 1956 he received a Ph. D. Degree in History, Classics and Sociology, from the Hebrew University; and moved into an academic position.)Thinking about the relatively poor education I received in my youth, big drawback of the Kibbutz educational system was that they had no exam to motivate their pupils. When it comes to educational systems, the world seems keen to adopt ideas developed by British experts. It was the British headmaster of the famous Eton wholargely created Germany’s postwar educational system and the international Baccalaureate. The program designed for 16- 18 years old, has done particularly well in the US. It allows schools to opt out of the national qualification system. University admissions bodies create special tariffs whereby the international baccalaureate is given a preferential treatment. This gives an added incentive to get into such program in the first place. In the Kibbutz system there were no exams at all; surely not national or international certification exams. The historical aspects of the Bible became central to my father’s scholarship. He viewed the Bible as a genuine record of ancient Jewish history, in addition to its unique religious value. The best way I can describe my father is as a self- taught biblical scholar with a Marxist orientation. He published a scholarly book (joint with his colleague and friend Shunia Ben- Dor) on the origin of ancient kingdom of Israel (major sources were the book of Joshua and the Book of Judges in the Bible. The book of Joshua presents several internally inconsistent scenarios which describe the entry of Israel into Canaan, and it also conflicts with the Book of Judges and other books of the Bible.(In a recent book by Finkelstein and Silverman, The Bible Unearthed, they write: “Bythe late eighteenth century and even more so in the nineteenth, many critical biblicalscholars had begun to doubt that Moses had any hand in the writing of the Biblewhatsoever; they had come to believe that the Bible was the work of later writersexclusively. These scholars pointed to what appeared to be different versions of the samestories within the books of the Pentateuch (The “Chumash”), suggesting that the biblicaltext was the product of several recognizable hands. A careful reading of the book ofGenesis, for example, revealed two conflicting versions of the creation (1: 1- 2: 3 and 2: 4-25), two quite different genealogies of Adam's offspring (4: 17- 26 and 5: 1- 28), and twospliced and rearranged flood stories (6: 5- 9: 17). In addition, there were dozens moredoublets and sometimes even triplets of the same events in the narratives of thewanderings of the patriarchs, the Exodus from Egypt, and the giving of the Law. Thedistinctive uses of geographical terminology and religious symbols and the roles playedby the various tribes in the two sources convinced scholars that the J text was written inJerusalem and represented the perspective of the united monarchy or the kingdom ofJudah, presumably at, or soon after, the time of King Solomon (C. 970- 930 BCE).Likewise, the E text seemed to have been written in the north and represented theperspective of the kingdom of Israel, and would have been composed during theindependent life of that kingdom (C. 930- 720 BCE). The book of Deuteronomy, in itsdistinctive message and style, seemed to be an independent document, "D." And amongthe sections of the Pentateuch that could not be ascribed to J, E, or D were a largenumber of passages dealing with ritual matters. In time, these came to be considered partof a long treatise called "P," or the Priestly source, which displayed a special interest inpurity, cult, and the laws of sacrifice.)Biblical scholarship is indeed intellectually an exciting stuff. The inspiration for my father’s the book came from the Marxist classic “the Origin of the Family, Private Property and the State” (circa 1884), written by Friedrich Engels. (Friedrich Engels, the son of a successful German industrialist, was born in Barmen in 1820. As a young man his father sent him to Manchester (England) to help manage his cotton factory. Engels was shocked by the poverty in the city and began writing an account that was published as Condition of the Working Classes in England (1844). In 1844 Engels began contributing to a radical journal called Annals that was being edited by Karl Marx in Paris. Later that Franco-German year Engels met Marx and the two men became close friends. Thereafter, Marx and Engels worked as a team. Friedrich Engels (in The Origin of the Family, 1884), was fascinated by primitive communism, a term usually associated with Karl Marx, referring to the collective right to basic resources, partner sharing, egalitarianism in social relationships, and absence of authoritarian rule and hierarchy that is supposed to have preceded social stratification in human history. Both Marx and Engels were heavily influenced by Lewis Henry Morgan's speculative evolutionary history. Lewis Henry Morgan— dubbed "the father of American anthropology"— in his 1877 cultural evolution masterpiece Ancient Society, flashing out the role of inheritance and shared partners in the U. S. American tribes. )At his middle age he visited London, where my son and my grandchildren live now. London – where Marx, a century and a half ago, prepared to write Capital; where Lenin, some 100 years ago, engineered a split in his political party from which the Bolsheviki – meaning “the majority” – were born. Indeed, my father went tovisit Karl Marx grave in high gate neiborhood during this visit. London has been for two centuries also the home of finance and until 50 years ago, of imperialism. It was only at the relatively old age of 55, when his adherence to the Marxist dogma was significantly weakened, that my father embarked on formal studies in the Hebrew University. At this stage the Kibbutz was also less dogmatic and more tolerant. The University awarded him a Ph. D. in biblical history (Professor Abraham Malmat, the renowned biblical scholar, was his adviser; Sara Yefet (Israel prize winner in biblical scholarship was his classmate), but this event came only after I had received my own Ph. D. from the University of Chicago. It is only the fact that he was a member of theKibbutz all his life. In contrast, I left the Kibbutz at a still formative age. This can explain such a distortion of the natural chronology of events between father and son. My mother Dora was born in Bivoular, a Romanian town, near the provincial capital city of Iasi, also at the beginning phase of WWI.[Iasi is a city located in north Romania, in southern Bukovina. This country was the easternmost crown land of the Austrian Empire. Iasi, before WWII, consisted of a hundred thousand individuals, half of which were Jews. [The Iasi pogrom is the most infamous in the history of the Romanian Holocaust. On June 25, 1941 (three days after the outbreak of the war) rumors circulated that Soviet parachutists landed near the city of Iasi. The army ordered a search of all Jewish homes. Many believed that Jews in Iasi were “enemy allies” of the USSR, “Bolshevik agents, and “parasites on the Romanian nation."].My mother’s maiden name is Leibovitch. She arrived in the Kibbutz just a few months after my father. My father, who knew Hebrew already from the Jewish high School in Kishenev became my mother’s Hebrew teacher. My mother was the one who had to take sole responsibility of us, the children, while my father was absent for relatively long periods. She did not have the intellectual curiosity my father had. But she was an integral part of a household, notvery typical in the Kibbutz society that educated its children under the banner that investment in schooling is of crucial importance. She also kept the family well tied together after my fatherdied at the young age of 57. (She was all alone at her small and austere apartment after my father died when in June 13, 1974 when 4 PLO terrorists sneaked through the Lebanon- Israel border and invaded Kibbutz Shamir. They ambushed and Killed 3 Kibbutz members who were working at the working honey factory in the outskirt of the Kibbutz. The members of the Kibbutz were having breakfast at the communal dining hall at the time. They seized their guns and ran in the direction from where gun fire was heard. In the gun battle that followed all the terrorists were killed--a self defense courageous act, with no help from the Israeli army. I imagine how terrified was my mother. But she did stay in the Kibbutz in the remaining years of her life.) She definitely was the Matriarch of our family. She was extremely proud of the skills that her own children acquired much through investment in human capital, while the average child of the Kibbutz was less educated.I have never known my grandparents. My Parental grandparents ( Meir and Fruma Berezin) and my maternal grandparents (Leon and Ada Leibovitch) did not followed my parents in the migration to the (then) Palestine. My maternal grandparents, who lived in Iasi, Romania, under the Antunescu Puppet regime during the World War II, did not survive the war period. First there was a pogrom in Iasi, in June 1941. Then forced labor was done in an out of the city. The hunger and sub- human conditions that were widespread throughout the region, were plausibly the cause of their death. My parental grandparents, who lived in the city of Kishenev by the river Dniester, did not survive the war period either. The 1939 Molotov- Ribbentrop Pact assigned this region to the Soviet Union. In May 1941 Heidrich, following Hitler’s plan to eliminate the jews , established the units of the Einsatzgruppen, to accompany the German army in Operation Barbarosa into the Soviet Union. Their specific mission was to execute not only members of the Jewish community, but also communist leaders. Kishenev, like the rest of the region became a killing field, as Poland before it. I do not know how precisely my grandparents’ life ended, because my parents lost all communication with them during the war.My younger brother Ehud (who is the Dean of Faculty of Medicine at the Hebrew University in Jerusalem) inherited my father’s broad intellectual curiosity. My younger sister Hava (who is a fertility nurse- specialist in Hadassa Medical Center in Mount Scopus) inherited my father’s good nature and my mother’s legacy of how to raise a well educated family. All of us inherited the “optimism gene” from my mother. We tend not to complain about bad luck and always look forward with an optimistic sense of meeting new challenges ahead. I liked playing basketball, listening to music-- Beatles’ music, 1950s, 1960s and 1970s pop music, as well as Classicalmusic, especially, Bethoven’s Symphonies. (At the funeral of my son, Ofair, we played the third symphony, The Eroica). A member of Kibbutz Shamir, Yahali Wagman, a musical prodigy as a teenager, and a graduate of The Juilliard School of music, motivated us to listen to classical music. I learned to play the clarinet and became fascinated with Mozart’s famous concerto for clarinet (Wolfgang Amadeus Mozart - Clarinet Concerto in A Major). In our class we were just 10 children with very distinct Israeli names: Ziva, Uzi, Ygal, Hillel, Amos, Oded, Amnon, Amit, Yuval, and myself , named Assaf, the youngest. At the time the name Assaf (taken from the book of Psalms) was quite rare. ( IDF Major- General Assaf Simchoni (1922- 1956) who commanded the Sinai Campaign (1956), and was killed in an airplane accident at the end of the war, was another person with a same. A bit older than me and also born in a Kibbutz, Geva . ) People were not used to such a name. Some pronounced it as Esav, (Esau , Standard Hebrew Esav, is the son of Isaac and Rebekah and the older twin brother of Jacob in the biblical Book of Genesis, who, in the Torah, was tricked by Jacob into giving up his birthright (leadership of Israel) for a "mess of pottage" (meal of lentils). (Genesis 25: 29- 34).) I must admit I had many moments of embarrassment because of the (then) unusual name. Now days, this name is one of the most popular names in Israel.About growing up in a remote place, you may read Gabriel Garcia Marquez' One Hundred Years of Solitude. This is a story of one hundred years in the life of Macondo, a mythical Colombian town, a fresh new placeisolated from civilization, and its inhabitants - the story of the town's birth, how it developed a lively community, and how tragically it has reached its end. It was founded by a team which included the married couple Jose- Arcadio Buendia and his wife Ursula Igueren. They started a dynasty that lasted a few generations. Macondo was deserted after the last offspring, an infant, was left alone and died. The experience of growing upin a remote isolated new establishment, and be a part of an emerging small community, where its leaders trying to establish new community rules and norms of behavior, methods of education, developing health care and social organization, is what re-inventing I feel as some kinship to the story with my childhood’s experience in Kibbutz Shamir. In both the Macondo and Kibbutz Shamir stories, the children were part of a big social experiment. Luckily, in sharp contrast to the sorry end of Macondo after 100 years of existence, the community of Kibbutz Shamir was able to fully integrate itself, absorbing the center- core of the country in social and cultural features. The kibbutz was able to modernize its social organization institutions and economic well being. Indeed, 60 years after its birth, the Kibbutz is a great success story. But there is a weakness with the kind of education that I had experience with growing up there. When many years later I became a Professor of economics, in my book Population Economics (MIT Press, 1995), I was able to identify key demographics economics issues for different societies, including those that characterize the kibbutz. My analytical thoughts about the difference among various ways of social organization, were, as it turned out, strikingly fit the fertility- education choices prevailing in the Kibbutz; at least for the kibbutz system at the time I was growing up . In the book Population Economics (MIT Press, 1995), co- authored with Efraim Sadka, we analyzed two education- fertility regimes, referred to as the “children as capital goods” regime, and the “children as consumption goods” regime. The “children as capital goods” regime features parents who treat their children as a “capital good” , bringing them up and investing in them with an objective that the children, as grownups, take care of parents who already reached their old age. This model seems to capture fertility- education choices in traditional economies, where risk- sharing and financial saving institutions are almost entirely absent public schooling is scarde and government provided social security system does not exist. In contrast, the “children as consumptiongoods” regime prevails when financial markets are well developed and the government provides both public education and old age social security. The fertility- education decisions are motivated to a large extent by the parents’ altruistic and kinship motives. They can provide for their old age securities through alternative market- based and government provided means. This means that parents, who care about the well- being of their children, would bring out relatively small number of children. In such a regime raising a child is costly. Parents invest in the education of each fertility-education one of them, so that they become skilled and raise their earning capacity. Interestingly, the Kibbutz system at the time I grew up, the investment- in- education decisions are akin to as “children as capital goods” regime in my analytical model . The Kibbutz cut itself altogether from the national education curriculum, had no use of exams and diplomas, and did not allow, as a rule, its members to pursue higher education at the universities. The educational system put an emphasis onskilled required for its own business sector; mostly agriculture. The upshot was that opportunities, whichoutside of the Kibbutz require broader proven skills were either unavailable, or very costly to take advantage of, for a typical person who was raised in the Kibbutz. These policies were in part geared to keep the children when they grew up to be productive and innovative only in the confines of the Kibbutz needed lines of work, thereby helping provide for the old age security of their parents, as in the “children as consumption goods” regime in the theory.But there were also some important advantages. As expected, growing up in the Kibbutz system I have hadintensive social interactions with my peer group (in the Kibbutz system you can develop well your socialskills, being together almost 18- 20 hours a day with children of roughly your age; only in the remaining 4- 6hours a day did we spend a fair bit of time with our parents). I thus was able to develop good social skills atthe very early age; which served me well later in life. In such an environment “peer effects” seem to be veryimportant. When your classmate is particularly smart, dishonest or lazy, what does that do to you? Especially important when you are at the formative young age period. Another important influence is the “parents effects”; this balances off some negative peer effects.HIGH SCHOOL FOLLOWED BY A SHORT