Intellectual Property Research Institute of Australia

IPRIA Working Paper Series

    Intellectual Property Research Institute of Australia Working Paper No. 10/2005

    Operationalizing Value-Based Business Strategy

    by

    Joshua S Gans, Glenn Macdonald and Michael Ryall

    Date: April 2005

    Abstract: “Brandenburger and Stuart (1996) identified coalitional games as a means of providing precise notions of value to evaluate strategic opportunities. In this paper, we show how coalitional game theory can be utilized to operationalize these approaches. In particular, we demonstrate the importance of considering full competitive interactions (rather than simply added value) when applying coalitional game theory and also how this can be employed to provide insights into the workings of an existing economic activity as well as to suggest ways that the activity might be altered to a …rm’s advantage. We illustrate with an application in which an innovator considers whether to commercialize a new technology.

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