Evolutionary game theory in patent alliance dynamics: strategy and policy implications

Abstract

ABSTRACT This study investigates the dynamics of patent alliances, underscoring their strategic relevance for firms pursuing technological innovation and market leadership. We address the issue of opportunistic behaviour stemming from the contractual gaps in these alliances, proposing strategic measures to curtail such conduct and bolster alliance robustness. Utilising Evolutionary Game Theory (EGT), we conduct numerical simulations to analyze the motives for alliance formation, the efficacy of anti-opportunism strategies, and their influence on alliance durability. The study highlights how regulatory policies increase repercussions, fostering cooperative alliances. Our simulations, predicated on defined parameters such as the likelihood of detecting and sanctioning opportunistic actions, showcase how these factors shape the strategic decisions of alliance members. This study enriches the theoretical discourse on patent alliance management by integrating the EGT approach, shedding light on effective deterrents against opportunistic behaviour and mechanisms fostering alliance solidarity. We advocate for a synchronised approach that aligns stringent regulatory practices with corporate strategies to ensure the resilience and success of patent alliances, crucial for navigating the complexities of competitive technology markets and maintaining long-term alliance efficacy. This comprehensive strategy is essential for managing the intricacies of patent alliances and securing their long-term viability and productivity.