In this paper, we show that trust favors specialization in complexity. U.S. states with a high level of generalized trust tend to specialize in industries involving more complex input-output relationships. This pattern is not driven by differences in the states’ other observable...

U.S. states with a high level of trust specialize in industries that involve more complex input-output relationships. This specialization pattern is not driven by differences in the states' and industries' other observable characteristics. While it is possible that specialization in complex...

We show that the negative impact of financial crises on trade is magnified for destinations with longer time-to-ship. A simple model where exporters react to an increase in the probability of default of importers by increasing their export price and decreasing their export volumes to...