Match!

Using an Iterated Prisoner's Dilemma with Exit Option to Study Alliance Behavior: Results of a Tournament and Simulation

Published on Dec 1, 2005in Computational and Mathematical Organization Theory1.37
· DOI :10.1007/s10588-005-5589-3
Steven E. Phelan14
Estimated H-index: 14
(UNLV: University of Nevada, Las Vegas),
Richard J. Arend17
Estimated H-index: 17
(UNLV: University of Nevada, Las Vegas),
Darryl A. Seale17
Estimated H-index: 17
(UNLV: University of Nevada, Las Vegas)
Abstract
Nearly half of all strategic alliances fail (Park and Russo, 1996; Dyer et al., 2001), often because of opportunistic behavior by one party or the other. We use a tournament and simulation to study strategies in an iterated prisoner's dilemma game with exit option to shed light on how a firm should react to an opportunistic partner. Our results indicate that a firm should give an alliance partner a second chance following an opportunistic act but that subsequent behavior should be contingent on the value of the next best opportunity outside the alliance. Firms should be more forgiving if the potential benefits from the alliance exceed other opportunities. The strategies were also found to be robust across a wide range of game lengths. The implications of these results for alliance strategies are discussed.
  • References (40)
  • Citations (18)
References40
Newest
#1Robert Axelrod (UM: University of Michigan)H-Index: 43
#2Willie Hamilton (UM: University of Michigan)H-Index: 56
#1D. Gordon Smith (BYU: Brigham Young University)H-Index: 7
#1R. Duane Ireland (UR: University of Richmond)H-Index: 60
#2Michael A. Hitt (College of Business Administration)H-Index: 95
Last.Deepa Vaidyanath (College of Business Administration)H-Index: 3
view all 3 authors...
#1Jeffrey J. Reuer (Max M. Fisher College of Business)H-Index: 41
#2Maurizio Zollo (Ad: INSEAD)H-Index: 24
Last.Harbir Singh (UPenn: University of Pennsylvania)H-Index: 42
view all 3 authors...
#1Jeffrey J. Reuer (Max M. Fisher College of Business)H-Index: 41
#2Africa Ariño (University of Navarra)H-Index: 19
Cited By18
Newest
#1Moshe Dror (UA: University of Arizona)H-Index: 36
#2Graham Kendall (University of Nottingham Malaysia Campus)H-Index: 48
Last.Amnon Rapoport (UCR: University of California, Riverside)H-Index: 48
view all 3 authors...
#1Amnon Rapoport (UCR: University of California, Riverside)H-Index: 48
#2Darryl A. Seale (UNLV: University of Nevada, Las Vegas)H-Index: 17
Last.Andrew M. Colman (University of Leicester)H-Index: 31
view all 3 authors...
#1Jbid Arsenyan (BAU: Bahçeşehir University)H-Index: 6
#2Gülçin Büyüközkan (Galatasaray University)H-Index: 36
Last.Orhan Feyzioğlu (Galatasaray University)H-Index: 12
view all 3 authors...
Jan 1, 2014 in HICSS (Hawaii International Conference on System Sciences)
#1Tobias EngelH-Index: 4
#2Andreas EnglschalkH-Index: 1
Last.Helmut KrcmarH-Index: 36
view all 5 authors...
#1Jiawei Li (University of Nottingham)H-Index: 11
#2Philip Hingston (ECU: Edith Cowan University)H-Index: 19
Last.Graham Kendall (University of Nottingham)H-Index: 48
view all 3 authors...
View next paperThe Evolution of Cooperation