Culture and diversity in knowledge creation

Is the paradise of e¤ortless communication the ideal environment for knowledge creation? Or, can the development of local culture in regions raise knowledge productivity compared to a single region with a unitary culture? In other words, can a real technological increase in the cost of collaboration and the cost of public knowledge ow between regions, resulting in cultural di¤erentiation between regions, increase welfare? In our framework, a culture is a set of ideas held exclusively by residents of a location. In general in our model, the equilibrium path generates separate cultures in di¤erent regions. When we compare this to the situation where all workers are resident in one region, R & D workers become too homogeneous and there is only one culture. As a result, equilibrium productivity in the creation of new knowledge is lower relative to the situation when there are multiple cultures and workers are more diverse. JEL Classi\u85cation Numbers: D83, O31, Z1 Keywords: knowledge creation, knowledge diversity, ideas and cultur