ISRAEL: Profits on the Kibbutz

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Labor relations on the kibbutz sound like a factory manager's version of The Impossible Dream. The factories pay no wages to kibbutz members, though they deposit their profits in the treasury that maintains the collective farm. The workers nevertheless labor hard—kibbutz factories raised their productivity an imposing 11% last year —and none has ever gone on strike. The kibbutz plants consequently keep prices extremely low: high school and college lab equipment is sold in the U.S. at 20% below the price charged by American companies, and plastic flushing systems for toilets are sold in Africa at 15% less than competitive brands. Most of their output is sold to the Israeli government or large private firms, but the bargain prices are beginning to win a modest export market.

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