Virtual Enterprise And Its Partner Selection

Competition is the core of the market mechanism. It compels enterprises to make reasonable decision and distribute resources effectively. With the coming of the network economics, the new trend from confiictive competition to co-opetition becomes more and more obvious. This paper summarizes and contrasts all kinds of confiictive competition theories in the views of economics and management. Meanwhile, this article analyses the connotation, cause of formation and the basic patterns of co-opetition. Virtual enterprise is the very important organization of the compound relationship. The thesis studies its essence, character, function and the existent condition in the view of the economics and resource flowing. Additionally, the author adopted the methods of Game Theory and Optimal Theory to analyze the following problems: the profit and cost of alliance, the methods of partner selection, the inequality of the partner's relationship, the indetermination caused by imperfect information, the optimal profit distribution among the partners and the defensive mechanism to the opportunism behaviors. At last, this paper analyzes the enlightenment and the applied value of the virtual enterprise to Chinese companies.