Multidisciplinary innovation is the engine of growth of an increasing number of economies. Innovation output depends increasingly on information sharing and cooperation between creative agents. Sharing and cooperation requires the existence of generalised trust. Social capital consists of trust...

This paper develops a two-country, general equilibrium model of oligopoly in which the degree of horizontal product differentiation is endogenously determined by firms' strategic investments in product innovation. Consumers seek variety and product innovation is more skill intensive than...