The Game Model in Competitive Decision-making

Abstract

Game theory is a theory that study the rational decision-makers' decision-making behavior under the condition of strategic interaction between the parties. The traditional economic management theory focuses on the profit-maximizing of a single enterprise with the resource constraints, but the game theory play particular emphasis on market profit equalization that formed in modern competition. This kind of profit equalization is that the parties do no want to achieve through changing his own strategy unilateral and in response equilibrium conditions. Competition among enterprises is actually the game among the various strategies. In the competitive decision-making game process, each firm will make decisions according to the competitors' decision to maximize their own profit. This paper uses the game model innovatively to analyze the competitive decision-making process between enterprises, and apply it to decision-making process to provide some guidance for enterprises making competitive strategies.