Very early on in economics 101, you are taught that pumping money into investment projects usually leads to a growth economy. Simple enough.

New stats from the OECD revea how Israel spends nearly 5% of its GDP on r&d. To put that in perspective. If you compare that level to the rest of the OECD group, which Israel is about to join, then Israel is leader of the pack with nearly twice the OECD average. 

It is not just this money create jobs etc. Down stream, wealth is generated through higher export sales or improved efficiency levels in the local economy.

No surprise then that Israel is one of the countries emerging strongly from the global recession of the past year. In fact, economic indicators for November and December 2009 have just been revised upwards.

As a word of caution, first investments in Israeli companies dropped around 50% in 2009. One reason for this was clearly a knock-on effect from the recession. A second factor is a suspected shift towards revenue generating companies.