Abstract
In this paper, setting the high-tech industry as the background, we build a dynamic duopoly game model in two cases with different government subsidies based on the innovation inputs and outputs, respectively. We analyze the equilibrium solution and stability conditions of the system, and study the dynamic evolution of the system under the conditions of different system parameters by the numerical simulation method. The simulation results show that both innovation subsidy policies have positive effects on firms’ innovation activities. Besides, improving the level of innovation can encourage firms to innovate. It also shows that an exaggerated adjusting speed of innovation outputs may cause complicated dynamic phenomena such as bifurcation and chaos, which means that the system has relatively higher entropy than that in a stable state. The degree of the government innovation subsidies is also shown to impact the stability and entropy of the system.
Highlights
Nowadays, with the rapid improvement of the global scientific and technological level, there is a growing need for innovation to be considered in many aspects of enterprises, such as production, operation and management
We propose two different forms of government subsidies for innovation input and innovation output, respectively, and we establish a dynamic game model between two enterprises with bounded rationality
We analyze the complexity of the model and discuss the effects of two different forms of government subsidies on stimulating the innovation activities
Summary
With the rapid improvement of the global scientific and technological level, there is a growing need for innovation to be considered in many aspects of enterprises, such as production, operation and management. We propose two different forms of government subsidies for innovation input and innovation output, respectively, and we establish a dynamic game model between two enterprises with bounded rationality. In this process, we analyze the complexity of the model and discuss the effects of two different forms of government subsidies on stimulating the innovation activities. We analyze how the innovation decisions’ adjusting speed, the degree of government subsidies and the beneficial coefficient of innovation influence the equilibrium, entropy and stability of the system
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