The restructuring stages of Israeli Arab industrial entrepreneurship

The current pattern of industrial development in Arab settlements in Israel represents, above all, adaptation to restructuring processes operating thr oughout the Israeli economy. The result may be viewed as a form of peripher al industrialization of small plants specializing in less-advanced industri al production. The peripheralization process and the fact that Israeli Arab industry has remained marginal to the national economy should be understoo d in the context of the structural conditions in which Arab entrepreneurshi p is embedded. The impact of three forces is stressed: government policy, l arge corporations, and the internal sociocultural properties peculiar to th e Arab population in Israel. The resulting form of industrialization is based on restructuring processes formatted as a number of distinctive development stages, which must be und erstood within the wider framework of Israel's economic restructuring. The dominant form of capitalist production affected the transformation of the I sraeli Arab economy at each period, from state management to corporate domi nance, and currently succeeded by a new accumulation regime affected by glo balization processes. Furthermore, majority-minority relations affected it with each pole embedded in its own ethnic milieu. These majority-minority r elations, supported by a selective government policy, have since been super seded by the relations conducted between the Jewish-dominated core and the Israeli-Arab-subordinated periphery. The result of this process has diverse ly affected both economic poles, and continues to influence the form of Ara b industrialization, branch selection, and rate of plant openings. Furtherm ore, the result is a failure by Arab entrepreneurs to penetrate the more pr ivileged sectors of the national economy, partly because of the failure of the Israeli political and economic elite to respond to Arab efforts at expa nsion into the larger economy.