Abstract
Unlike the traditional SCP (Structure-Conduct-Performance) model, several Holistic Innovation ( HI ) policies formulated by policymakers under strategic guidance can optimize the market structure and performance. Owing to the value and difficulties of issues, controversies (especially those from abroad) abound. Few scholars have conducted interdisciplinary research in this domain using IT technology. This study begins with a simple firm theory model, extends the Cournot duopoly model, then constructs a theoretical model referring to HI, the market structure, and performance. Results of this study revise the traditional view that “firms/enterprises with market advantages (monopoly firms and oligarchs) are harmful to the market structure and its performance and reveal the boundary conditions for monopoly and oligopoly firms harming the market structure and performance.” In this study, we design the research model as an application software (with obtained patents). Through data calculation, we conclude that “if no more than eight oligarchs exist, then the market structure and performance will not be hurt.” Using firms’ data, the application software can accurately calculate and measure the market structure and performance in the context of HI, thereby helping firms and policymakers make precise strategic decisions. This study contributes to research on HI as well as on the market structure and performance. Moreover, this study expands the academic understanding on the tripartite relationship. The traditional SCP model regards the market structure as a difficult construct to change, and by merely conforming to it, innovation can influence improved performance. By contrast, this study argues that when HI becomes increasingly crucial and shared in the future, the market structure can be influenced and will demonstrate spectacular market performance.
Highlights
Economists believe that the essence of economic development lies in innovation
DATA CALCULATION ON Holistic Innovation (HI), MARKET STRUCTURE, AND PERFORMANCE According to our analysis model, we conduct a statistical survey on the data of 150 phosphorous chemical industry firms from 2004 to 2016
MAIN CONCLUSIONS AND CONTRIBUTIONS This study constructs a decision-making model and software based on primary game theory and conducts data experiments
Summary
Economists believe that the essence of economic development lies in innovation. a monopoly is a primary source of technological innovation under the capitalist financial system. The simulation evaluation system software developed through software engineering and information processing technology can calculate the results of the evaluation model and form research reports automatically once users input related parameters Such a calculation model can solve (with a calculator, a spreadsheet software, and manually) a series of problems of existing research and analysis methods, such as computational complexity, duplication, inefficiency, unreliable conclusions, requirements for professionals to complete, and so on. The application of this simulation software for analyzing and evaluating the state of an industrial organization can explore the economic and practical economic evaluation methods that non-economic experts employ, which can help promote the development of economic market structure and performance measurements and evaluations
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