Which has greater refractive index, air or water? Why and how?

The refractive index is a measure, indirectly, of how much
the speed of light changes as it moves from one medium or material  to another.  The
denser the medium the more the speed of light slows down.  This effect is seen, for
example, if you look at an object laying on the bottom of a swimming pool.  The object's
actual position is different than where it seems to be when looking at it from
above.

When light hits the surface of a piece of glass at
an angle its speed changes as it goes from the air (low density) to the glass (much
higher density) and the light rays bend.  You can see this bending because a rainbow of
colors is produced.