|M.Sc Student||Kalinhaff Dalia|
|Subject||Privatization in the Kibbutzim Movement|
|Department||Department of Industrial Engineering and Management||Supervisor||PROF. Benjamin Bental|
The classic Kibbutz can be thought of as an insurance institution that provided its members full insurance. As a result of the crisis of the 1980s, the Kibbutz movement had to privatize many of its services. The thesis examines the factors that influenced the intensity of the privatization process that dismantled the insurance aspect either fully or partially. The study compares the dismantling of the insurance aspect in the Kibbutz to Townsend’s study on the creation of insurance among rural communities in developing countries. A common feature to both processes involves the problem of moral hazard. The study uses data on privatization measures, economic and demographic characteristics pertaining to over 200 Kibbutzim. It uses logistic regressions in order to identify the factors that influence different privatization measures, in an attempt to find the impact of the moral hazard effect on the privatization decisions. The study finds the following:
1. The average age of Kibbutz members has a positive influence on all privatization measures.
2. There seems to be a negative wealth effect on the privatizations that have been studied.
3. The number of members has a negative influence on 7 out of 8 of the privatizations, indicating that large Kibbutzim have better inside insurance abilities.
4. Holding marketable assets helps the Kibbutz smooth income fluctuations and reduces the need to privatize.