Game Analysis of Knowledge Sharing in Virtual Enterprise

Virtual enterprise is a dynamic enterprise alliance for the purpose of reacting to drastic market and improving core competence. Knowledge sharing is crucial to the virtual enterprise. The case of knowledge sharing between two member enterprises without participant of hegemony enterprise has been discussed using Prisoner Dilemma Game Model. There are many factors may affect the strategy of member enterprise like utility of monopolizing the knowledge, the lost monopolizing benefit when sharing the knowledge and the cost of the knowledge sharing. The theory of complete and perfect two-stage dynamic game of knowledge sharing based on work competition model has been applied to the analysis on knowledge sharing in virtual enterprise. The member enterprise will choose knowledge sharing level to make marginal income equal to the value of negative utility by sharing its knowledge at Nash Equilibrium. The hegemony enterprise should formulate a reasonable stimulation policy and give enough bounty to the member enterprise who has contributed more knowledge to the virtual enterprise through knowledge sharing. There is a positive correlation between stimulation level and the variance of random item probability distribution of production function.