Departmental Bulletin Paper First Step Analysis of Game Theory on Firms' Strategic Goals and Value Creation

Hoshino, Mitsuhide

31pp.39 - 45 , 2015-06-30 , 長崎大学経済学部
This study provides a first step analysis of how strategic goals influence value creation and firm performance using a strategic model based on game theory. Results have shown that players' choices of normative strategic goals are Pareto optimal. The key reasons are as follows: (1) the same choice of strategy acts as a rule to be observed, and (2) there is an equal allocation of value (i.e.,payoffs) to players. The results imply that (1) consensus building through discussion by participants (e.g.,employees) and (2) the seniority system, both still typical among successful Japanese firms, might contribute to building the highest level of value through maintaining a normative goal frame.

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