56 economists at top universities in the United States warned in an open letter on Wednesday that the changes to Israel's judicial system proposed by the new government of Prime Minister Benjamin Netanyahu would have negative consequences for the economy.
"Numerous Israeli economists, in an open letter that some of us joined, expressed concerns that such a reform would adversely affect the Israeli economy by weakening the rule of law and thereby moving Israel in the direction of Hungary and Poland," the letter read.
The letter noted that the signatories are winners of the Nobel Memorial Prize in Economic Sciences; Current or former Presidents of the American Economic Association, American Finance Association and/or the American Law and Economics Association; Recipients of the Fischer Black, John Bates Clark and/or BBVA Foundation prizes; Elected members of the National Academy of Sciences and/or the American Academy of Arts and Sciences; And/or people who formerly served as the World Bank Chief Economist, Chair of the Council of Economic Advisors or the International Monetary Fund Chief Economist.
"A strong and independent judiciary is a critical part of a system of checks and balances. Undermining it would be detrimental not only to democracy but also to economic prosperity and growth," the letter read.
Israeli hi-tech sector rallies against judicial reform
The Jerusalem Post reported earlier this month that some in Israel's hi-tech sector fear that investors will be more reluctant to put their money in Israel if the judicial reforms are enacted.
“The fear is that if investors are unsure about Israel’s protection of the rule of law – including property rights and the ability to get to the court in the event of a dispute – they’ll be much more reluctant to invest,” Ben Rabinowitz, managing partner and founder of Israeli venture capital firm Amiti Ventures, told the Post.
“Businesses need checks and balances, and they need consistent rule of law. When a government has all the power, as an independent business you’re no longer protected or have that predictability you need.”
Zachy Hennessey contributed to this report.