American Academic Turns Down Netanyahu's Offer to Head Bank of Israel

Prof. Martin Eichenbaum, an expert on monetary and macroeconomic policy, who also teaches at the Interdisciplinary Center in Herzliya, apparently declined the offer by Prime Minister Netanyahu for personal reasons

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Prof. Martin Eichenbaum
Prof. Martin Eichenbaum Credit: Screenshot from Northwestern Univ. website
Meirav Arlosoroff
Meirav Arlosoroff

Leading American monetary economist Prof. Martin Eichenbaum of Northwestern University has declined an offer from Prime Minister Benjamin Netanyahu to become the next governor of the Bank of Israel, Israel's central bank. 

Eichenbaum, who had also turned down the position in 2013 when the current governor, Karnit Flug, was ultimately appointed, apparently declined the offer for personal reasons. The 64-year-old American-Jewish expert in monetary and macroeconomic policy is an adviser to the U.S. Federal Reserve Bank and the International Monetary Fund.

He also teaches at the Interdisciplinary Center in Herzliya and in the past advised the Bank of Israel on the work of its research department and is well-acquainted with the Israeli economy. He also speaks some Hebrew.

The prime minister is seeking an economist of international stature for the position of Bank of Israel governor and has therefore sought out leading economists in Israel and abroad for the post in a process that is being coordinated by the head of the National Economic Council, Avi Simhon.

As far as is known, Eichenbaum is the third leading candidate to decline nomination as the Israeli central bank governor. A former head of the National Economic Council, Eugene Kandel, turned it down from the outset, saying that he is not suited for the job, in part due to his lack of monetary background and his disinterest in dealing with the management of a major agency such as the Bank of Israel.

Prof. Jacob Frenkel, who served two highly successful terms as Bank of Israel governor, expressed interest in returning to the position but was forced to forgo the prospect over concern that it would revive questions regarding a 2006 incident in which he was accused of shoplifting from a duty-free shop at Hong Kong International Airport, a case that he said was the result of a misunderstanding.

Flug’s term as Bank of Israel governor expires in November.

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