The cooperative decision analysis on members of industrial technology innovation strategic alliance-the perspective based on sunk cost

Author(s): Zhan Zhang, Sima Lin

The activity is one of the most effective indicators monitoring the healthy development of industrial technology innovation strategic alliance. Also it is the key ruler to measure that whether alliances can complete the task of innovative national construction. In this paper, based on the perspective of sunk cost, we analyze the decision-making strategies of alliance cooperation by using the method of game theory. The results show that if all parties invest their resources which have a quite different sunk costs, is easier to occur moral hazard problem. At last, we give some reasonable suggestions to promote the development of alliance, the key is the organic combination of government policy, legislative system, two-part contract and partner selection mechanism.

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