The Palestinian Economy Under Occupation: Dependency and Pauperization

This article deals with the economy of those parts of Palestine which were occupied by Israel in June 1967, namely the West Bank and Gaza Strip,1 and attempts to identify and assess the overall economic impact of occupation to the present. The discussion will examine two central theses. The first is that the economies of the occupied territories suffer from heavy, far-reaching, and debilitating dependence on the Israeli economy. However, the dependence is so special and atypical, and reaches so far beyond the bounds of the dependency paradigm in mainstream literature, that the notion must be qualified so as not to be misleading. The second thesis is that the economies of the West Bank and Gaza Strip have suffered pauperization over the years, notwithstanding some outward appearances of prosperity or Israeli claims of economic well-being.2