Yes, i7 are better than i5, but for very few reasons.
The main difference is Hyper Threading (HT), i7 (and Xeon) have it, i5 don't. This allows each core to manage 2 processing threads, so a 4 core CPU work as a 8 core (lower performance than if it really had 8 cores, between Intel CPUs only). I don't know is there's any other significant difference, like more cache or other instructions.
Both i7 and i5 (and Xeon) have turbo mode enabled, only i3 and lower don't have it.
In multi threaded tasks, the Xeon will win near always. Only in single threaded or not well threaded tasks the i5-4590K will win because, clock for clock, Haswell (4th gen) is faster than Ivy Bridge (3rd gen).