As Nobel laureate in economics Professor Gary Becker puts it, “nowhere is the failure of socialism clearer than in the radical transformation of the Israeli kibbutz.”
If socialism could succeed, it should have done so here. Most of the kibbutz were founded by highly idealistic volunteers. The kibbutz were accorded high prestige in Israeli society, and many of Israel’s first political leaders were kibbutz members. After Israel was chartered in 1948, the kibbutz also received extensive government subsidies.
The failure of the kibbutz cannot be blamed on lack of ideological commitment, inadequate resources, or hostility from the surrounding “capitalist” society. It’s free riding, tragedy of the commons and the disincentivising of high-level achievement that are the problems.
Despite its advantages, the kibbutz model failed produce economically, and even failed to retain the loyalty of many of their own socialist members. Over time, many kibbutz residents became frustrated with the perverse incentives created by socialism, and many also desired the individual freedom and privacy created by private property. No talented young people wanted to stick around.
The only way the kibbutz have managed to survive at all has been by watering down or abandoning their commitment to socialism. If socialism cannot work under the highly favorable circumstances of the Israeli kibbutz, it almost certainly cannot work anywhere.
Here’s the post by Professor Becker: