We introduce a new model for the evolution of networks of firms exchanging knowledge in R&D partnerships. Innovation is assumed to result from the recombination of knowledge among firms in an R&D intensive industry. The decision of two firms to establish a new partnerships or to terminate an...

We develop a unified model embedding different behavioral mechanisms of social interactions and design a statistical model selection test to differentiate between them in empirical applications. This framework is applied to study peer effects in education (effort in studying) and sport...