Are drugs with low therapeutic index more effective?

Not necessarily. Simply put, a low TI indicates that the dose that causes a beneficial effect is "close" to the dose that causes unacceptable toxicity or lethality. A drug with a large or wide TI means that the dose that causes the beneficial effect is far lower than the dose that causes toxicity or lethality.

If a drug has a TI of 2, then the drug dose that causes toxicity is twice that which causes the benefit. So a mistake of taking 2 pills instead of 1 can be disastrous. If a drug has a therapeutic index of 13, then the dose expected to cause toxicity is 13x that which causes the toxic effects, and is pretty safe.

To compare effectiveness of a drug, you have to compare drug efficacy and TI. For a large TI drug, sometimes you just need to increase the dose. In the example above where TI=13, you could increase the dose 6 0r 7 times and you may not see an increase in toxic effects.