Thanks Billions!

(Actually More, But We
Lost Count Decades Ago)

Unemployment, Not Inflation
Is Enemy Of The Poor

The rise in Israel's unem-
ployment contributes more
to the inequality of income
distribution than inflation,
according to a new study
released by the Bank of
Israel.
The study, by economist
Momi Dahan of the central
bank's research division,
shows that low-income indi-
viduals bear most of the
brunt of both unemploy-
ment and inflation.
In recent years, unem-
ployment has been the lead-
ing reason for the increas-
ing inequality in income
distribution.
Mr. Dahan notes that the
positive connection between
inflation and income
inequality proves the inabil-
ity of low-income wage
earners to be spared wage
erosion despite cost-of-liv-
ing adjustments.
These agreements have
failed to prevent inequali-
ties from growing as infla-
tion increased.

Michigan's Largest Independently
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Mr. Dahan explains that
while the cost of living
adjustment is the only
means low-income earners
have to mitigate wage ero-
sion, high-income individu-
als benefit from other pro-
tective mechanisms - such
as personal contracts or
strong professional trade
unions.
Mr. Dahan also shows
that transfer payments,
such as National Insurance
Institute allowances, work
to reduce income inequali-
ties. By contrast, expanding
the size of the public sector
increases those inequalities.
The study found the min-
imum wage did not signifi-
cantly reduce the inequali-
ties among wage earners,
despite its intent to mini-
mize those differences.
The opening of the econo-
my after 1967 to workers
from the territories did not
have an impact on income
inequality, the study main-
tains.

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Leading Israeli Stocks
Traded On U.S.
Exchanges

Symbol Name

)
I

Save on All Major Name Brands
Open
\ititte
ntIsti
12-4

Exchange Aug. 20 Aug. 27 Change

SCIXF

Scitex

NASDAQ

8

25.13

'25.50

40.37

ECILF

ECI Telecom

NASDAQ

'41.50

'4725

+'5.75

TEVIY

Teva Pharm

NASDAQ

'25.75

'26.00

4.'0.25

IEC

PEC Israel

NYSE

'25.00

'25.88

+1'0.88

ELBTF

Elbit Computers NASDAQ

'31.75

'34.00

+1.25

ELT

Elscint LTD

'4.88

'5.00

+"0.12

ELRNF

Elron Electronics NASDAQ

'15.13

'16.75

+9.62

NYSE

TAD

Tadiran

NYSE

'29.50

'33.38

+'3.88

CMVT

Comverse

NASDAQ

95.38

'14.63

-1'0.75

LANTF

Lannet Data

NASDAQ

92.13

92.50

+'0.37

Source: Allen Mender, Prudential Securities,
West Bloomfield.

I
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