The effects of government subsidy on manufacturers' technology sharing behavior with risk consideration

Abstract

AbstractThis study focuses on how consumer subsidy (COS) and manufacturer subsidy (MAS) influence a focal risk‐averse manufacturer's technology sharing, who balances between risk pooling effect and competition effect along with new entry for decision. When consumers' uncertain valuations are highly positively (or negatively) correlated for the manufacturers' products, the higher COS and the higher MAS can (or cannot) enhance the manufacturer's technology sharing because the risk pooling effect is strong (or weak), but the competition effect is weak (or strong). Only when the risk pooling effect dominates the competition effect, COS is more conducive than MAS to promoting technology sharing.