Both central bank and fiscal measures may contribute to weaken the incentives for banks to clear troubled assets from their balance sheets and to monitor their credit risk carefully. This, in turn, may reinforce the very problems that currently impair the functioning of the financial system. In a low interest rate environment this can foster lending to unprofitable business.
Despite the increase in the average number of years of schooling, literacy, numeracy and functioning in a digital environment among the adult population in Israel—at all levels of education—are lower than those in most of the advanced economies, and the situation is no better among students.