Cooperative Game Analysis based on Country Size and Market Position

Abstract

This paper studies the cooperative game theory, and analyzes the cooperative game with international scale and market position. From the perspective of evolutionary game theory, this paper discusses the preconditions for big and small countries to participate in regional economic cooperation and the stability conditions of economic cooperation. This paper combines cooperative game theory with regional economic integration, and the economic and political alliance among countries can be regarded as a cooperative game. In order to analyze the cooperation of member countries, the countries are divided into small countries and big countries according to their size and market position, and the replication dynamic equation is calculated, then the basic conditions of the strategy of big countries and small countries participating in regional economic alliance are obtained, and the strategy selection probability of participants under the conditions of equilibrium strategy and non-equilibrium strategy is analyzed. In addition, using evolutionary game theory and Jacobian matrix to analyze the stability of local equilibrium point, a reciprocal game model of regional economic cooperation between big and small countries is established. Through the research, it is found that the necessary condition for the formation of regional economic integration is the economic complementarity among the cooperative parties, and the sufficient condition is that the cooperative parties can coordinate the distribution of interests among themselves through effective consultation and finally reach a binding agreement on the distribution of interests, thus restricting each other's economic behavior.