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A tripartite evolutionary game analysis of contract manufacturer's brand strategy decisions in global value chains

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  • Huarong Zhou
  • Shengbing He
  • Qinke Lyu

Abstract

This paper investigates the brand strategy decision‐making process of the contract manufacturer (CM) in the context of three stakeholders: the CM, the original equipment manufacturer (OEM), and the government agency (GA). The evolutionary stability strategies and stability conditions are analyzed and a numerical simulation illustrates the effectiveness of the proposed method. The results show that whether the CM chooses “branding” strategy is mostly determined by the economic profit caused by strategies. The OEM's response mainly depends on the CM's strategic choice and the cost of suspending the cooperation. There exists a threshold effect in the promotion effect of government subsidy on the CM's brand building.

Suggested Citation

  • Huarong Zhou & Shengbing He & Qinke Lyu, 2022. "A tripartite evolutionary game analysis of contract manufacturer's brand strategy decisions in global value chains," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(6), pages 2237-2248, September.
    • Handle: RePEc:wly:mgtdec:v:43:y:2022:i:6:p:2237-2248
    DOI: 10.1002/mde.3521
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