Cooperation Level's Influnce On RJV

With the increasing economic globalization and the arrival of knowledge economy, the external environment of firms has undergone great changes, competition is increasingly strong and demand of consumers, governments and employees is also increasing. In the knowledge economy, the pace of technological innovation accelerating, life Cycles of product shortening, mar-ket globalization and information network technology being widely used, even very large firms still have difficulties independently developing some new technology.The possibility to rely on large-scale mass production to maintain competitive edge is getting increasingly slim.As a result, to gain market share, maintain core competencies and seek long-term development, we must constantly deliver new products. As consumers' demands are per-sonalizing, it's very difficult for firms to master all the New technology to remain competitive.Therefore, to form R&D alliances is an effective choice.In this paper, based on the D'Aspremont's two-stage model and other scholars' follow-up study, we take game theory and operational research as analytical tools and focus on semi-cooperative game. That is, firms cooper-ate first and respectively make yield decision simultaneously or sequentially. In these two different cases, we analyze how the level of cooperation in the game affect firms to make decisions. There are two main aspects:1. Take into consideration the cooperative and innovation game be-tween firms, through setting up a three-stage game model in which firms cooperate first in the RJV formation stage, then compete in the investment decision-making stage, and simultaneously make yield decision finally, we analyze the impact that the cooperation level exerts upon the R&D invest-ment levels and decisions in production stage. Lower unit cost obtained after the innovation of firms will enable it to occupy a larger Market share, while for the one with higher initial cost, to gain more market share, it has to pay more for R&D; when achieving equilibrium, the higher the self-R&D in- vestment,the higher the yield and the lower the market price. In a word, the impact the investment level exerts on the output and price level of the rival firm depends on the level of cooperation between the two sides; on the other hand, the impact the level of cooperation exerts on innovative investment, output and market prices depends on the specific Need Function.2. Take into consideration the cooperative and innovation game. Through setting up a three-stage game model in which firms cooperate in the invest-ment decision-making stage and then make yield decision sequentially in production stage, we analyze influnce exerted by the information sharing degree between firms on market share occupied by firms, the profit,the con-sumer surplus and social welfare. It shows that the follower must be strictly limit the level of cooperation to some certain extent so as to occupy a larger market share, while in order to get a larger market share; the leader need a reasonable unit cost after innovation. If the demand function satisfies cer-tain conditions, with the increasing degree of technology sharing, prices will be lower and the R&D costs of production, Profits, consumer surplus and social welfare will all be increased.