José de Sousa attended the 33rd Annual Congress of the European Economic Association (EEA) on August 27 – 31 2018 in Cologne, Germany.
He presented his paper Trust and Specialization: Evidence from U.S. States, co-authored with Amélie Guillin and Julie Lochard.
Abstract :
We investigate the role of generalized trust on the specialization of US states. Using production and exports at the state and industry-level and accounting for the endogeneity of trust behavior, we show that trust shapes comparative advantage. States with a high level of trust specialize in the production and exports of goods that require establishing contract-intensive input-output relationships to be produced. By exploiting the destination dimension of US exports, we also show that trust is not just about belief in the importer’s trustworthiness but also about preferences.