Scandinavian Working Papers in Economics
Working Paper Series,
Research Institute of Industrial Economics
No 1097: An Extended N-player Network Game and Simulation of Four Investment Strategies on a Complex Innovation Network
Wen Zhou (), Nikita Koptyug, Shutao Ye, Yifan Jia and Xiaolong Lu
Additional contact information
Wen Zhou: School of Computer Engineering and Science, Postal: Shanghai University, Shanghai, China, and Kellogg School of Management, Northwestern Institute on Complex Systems (NICO), Northwestern University, Evanston, IL, United States of America
Nikita Koptyug: Research Institute of Industrial Economics (IFN), Postal: P.O. Box 55665, SE-102 15 Stockholm, Sweden
Shutao Ye: School of Computer Engineering and Science, Postal: Shanghai University, Shanghai, China
Yifan Jia: School of Computer Engineering and Science, Postal: Shanghai University, Shanghai, China
Xiaolong Lu: School of Computer Engineering and Science, Postal: Shanghai University, Shanghai, China
Abstract: As computer science and complex network theory develop, non-cooperative games and their formation and application on complex networks have been important research topics. In the inter-firm innovation network, it is a typical game behavior for firms to invest in their alliance partners. Accounting for the possibility that firms can be resource constrained, this paper analyzes a coordination game using the Nash bargaining solution as allocation rules between firms in an inter-firm innovation network. We build an extended inter-firm n-player game based on nonidealized conditions, describe four investment strategies and simulate the strategies on an inter-firm innovation network in order to compare their performance. By analyzing the results of our experiments, we find that our proposed greedy strategy is the best-performing in most situations. We hope this study provides a theoretical insight into how firms make investment decisions.
Keywords: Complex Networks; Game Theory; Innovation; Innovation Network; Nash Equilibrium
JEL-codes: C72; C81; C82; D81; L14
Language: English
27 pages, December 15, 2015
Full text files
wp1097.pdf
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