2  BIS central bankers’ speeches  One of the factors impacting on productivity – technology – is the expenditure on research and development. In this parameter, Israel is among the leaders since the share of R&D in output is relatively high, as a consequence of the high share of ICT industries in Israel.
Some of the knowledge acquired within the framework of these industries’ R&D eventually is expressed in production abroad, but there is no doubt that the fact that the development centers of major international companies are located in Israel has positive external effects. In any case, this is mainly private R&D.