The Project on « Israel and the Regional Economy », housed at Harvard Business School.

The Project on Israel and the Regional Economy, housed at Harvard Business School, is a new initiative that serves as a central hub for faculty-led, cross-disciplinary research on key economic and social topics for Israel and the broader Middle East–North Africa (MENA) region.

The project brings together University faculty with affiliated scholars from Israel and around the world to tackle issues ranging from entrepreneurship and innovation to workforce development, health policy, banking and finance, and more. We talked with the program’s faculty chairs, Professors Paul Gompers and Raffaella Sadun, about the inspiration behind the project, takeaways from their first convening, and their hope for its future.

How did this project get started?
Paul Gompers: A couple of years ago, a group of faculty, mostly from HBS but also from the Law School and the College’s economics department, were interested in promoting research on Israel and the region. We had a vision of leveraging Harvard’s convening power and brainpower to conduct forward-looking, policy-relevant research for Israel and the MENA region, with Israel as the central player in that ecosystem.

The idea was partly motivated by some sabbatical work I did in 2022, when I traveled to 30 countries—including six in the MENA region—for a new research project. What struck me was how policymakers there were thinking about integration from a business perspective, especially around startups, innovation, and upskilling their populations—and how much they were looking to Israel as an example and as a potential partner.

In the summer of 2024, we submitted a proposal and met with University leadership, and they were very enthusiastic and supportive. It’s taken a little longer than we hoped to get everything organized, but we’ve gotten where we need to be. We’re very, very excited.

Tell us more about the vision and timeline.
PG: The idea is to do this for three years. Initially we’re aiming to do joint research with other faculty and Israeli academics. But the hope and the dream is that as the region moves forward, we’ll have an opportunity to recruit some faculty engaged in Arab research to help us think more about the MENA region, Israel, and the future.

In addition to partnering with academics on the research, we’re bringing in affiliated advisors to help us run experiments to get as close to the ground on the actual phenomena and do this kind of research, which can have a big impact. Our goal is do the kind of important, policy-relevant research that can have an impact in countries across the region.

The emphasis is on supporting research?
Raffaella Sadun: Yes. The research is why we’re here. We’re all very interested in this project because it gives us an opportunity to truly understand complexity by doing what we love, which is deep, rigorous, on the ground research.

As researchers, we like getting close to the phenomenon, talking to different stakeholders—in essence, trying to understand reality on the ground. I believe that this is our role in society as academics—it’s not getting second-hand information and taking a position based on that; it’s to understand reality and help other people understand too. That’s what motivates me to be doing this.

What are some of the things you’re most excited about?
PG: I’m super excited about the faculty we’re engaging with, the kind of things we can do with the policymakers and NGOs in Israel right now. I am proud of the fact that we got this off the ground and that we have generous alumni who are willing to support this.

Raffaella and I just ran a project launch where we brought in roughly 20 faculty and policy makers for an ideation conference. We went over some interesting research opportunities and came up with what I think are 12 amazing projects; eight around the startup innovation ecosystem and four on re-skilling. The enthusiasm among all the faculty really blew me away–the energy and interest was just tremendous. That’s exciting.

What are the most immediate next steps?
PG: Immediately post-conference we’re trying to maintain the momentum. I’ll be going to Israel for two weeks in January to meet with our affiliated faculty. We’re hiring two research associates and putting the pieces into place—you need both the data and the research staff to pull it all together and start the research.

There are a number of data sources that the Israelis have access to, and others that we have access to, so we’re creating some very large, comprehensive data across the entire Israeli labor market. It’s a matter of starting the analysis as soon as possible.

RS: On the re-skilling side of things, we’re trying to get a sense of the initiatives that have already been launched in both the public and private sectors. We’re very interested in studying how re-skilling can bring disenfranchised populations into the workplace. There has been a lot happening on that front in Israel, so I think we can add value by providing a sense of the many different initiatives that have been conducted, trying to classify the approaches, and eventually creating an evaluation platform that will allow policymakers, donors, or even the organizations themselves to really understand and scale what works. We’ll start our work by creating that evidence base. From there we’ll set up experiments and projects that will be conducted in partnership with other academics.

Will you bring this work into the classroom?
PG: Absolutely. Raffaella and I are currently pursuing a case that touches upon both research agendas. Decart, an Israeli AI startup, has gone from stealth mode to being worth over $3 billion over the course of about a year and a half. It’s a hot, hot company. But the founding team illustrates some of the strengths and weaknesses of the Israeli talent pool.

The co-founders met in the Israeli Army. One grew up ultra-Orthodox and had never been to a secular school, and the other got his PhD in computer science at 23. The disparity of their families’ incomes—understanding how to think about those well below and above the poverty line—makes this work critically important. The problem of up-skilling and participation in labor force is a global question. Much like the best of HBS research, the pedagogical research and activities are synergistic with the academic research agenda.

RS: This is a geography that can provide useful insights for other countries in the MENA region, as well as for the United States and Europe. Some of the problems that we will study—for example, reskilling adult workers—are challenges faced by many countries, and this initiative provides us with the opportunity to focus on a laboratory to study these issues. We also hope that our research will end up providing useful insights to our students and to our community.

What is your hope for the future of the project?
RS: It’s now cross-collaborative across schools, disciplines, and areas of interest, and we very much hope to expand over time. This is the beginning, but there may be opportunities in the School of Engineering and Applied Sciences, in more technical disciplines, precisely because we are working at the interfaces of technology, society, and business.

PG: Harvard is such a positive force for convening on these issues. Over the course of my sabbatical, I had something like 500 meetings. I had research staff from the centers in whatever region I was in, it was fabulous. But I wasn’t able to have all these meetings because I’m Paul Gompers, I had them because I’m a Harvard professor. The Harvard brand, reputation, alumni—this uses Harvard’s power to do good in the world. Doing good is policy, it’s relevant research, it’s bringing people together to change the narrative. Instead of focusing on the Arab-Israeli conflict, focusing on Arab-Israeli integration. How do we think about the future of the region and the role that Harvard could play in helping that happen? If we’re successful, the Harvard community will have made a positive contribution.