We provide a rationale for the recent burst in the amount of collaborative activities among firms selling complementary products, highlighting factors that may result in a lower profitability for such firms overall. To this end, we examine a game-theoretic model in which firms can collaborate with producers of complementary goods to en- hance the quality of the systems formed by their components. Collaboration makes it cheaper to enhance such quality, so building innovation ecosystems results in firms investing more than if collaboration were impossible. In markets reaching saturation, firms are trapped in a prisoner's dilemma: the greater investments create more value, but this does not translate into greater value capture because the value created rela- tive to competitors does not change. We also examine the (dis)advantages for a firm of having open or closed interfaces for the component it sells when the environment is competitive as well as how this is related to the endogenous emergence of two-sided platforms.

Mantovani, A., Ruiz-Aliseda, F. (2016). Equilibrium Innovation Ecosystems: The Dark Side of Collaborating with Complementors. MANAGEMENT SCIENCE, 62(2), 534-549 [10.1287/mnsc.2014.2140].

Equilibrium Innovation Ecosystems: The Dark Side of Collaborating with Complementors

MANTOVANI, ANDREA;
2016

Abstract

We provide a rationale for the recent burst in the amount of collaborative activities among firms selling complementary products, highlighting factors that may result in a lower profitability for such firms overall. To this end, we examine a game-theoretic model in which firms can collaborate with producers of complementary goods to en- hance the quality of the systems formed by their components. Collaboration makes it cheaper to enhance such quality, so building innovation ecosystems results in firms investing more than if collaboration were impossible. In markets reaching saturation, firms are trapped in a prisoner's dilemma: the greater investments create more value, but this does not translate into greater value capture because the value created rela- tive to competitors does not change. We also examine the (dis)advantages for a firm of having open or closed interfaces for the component it sells when the environment is competitive as well as how this is related to the endogenous emergence of two-sided platforms.
2016
Mantovani, A., Ruiz-Aliseda, F. (2016). Equilibrium Innovation Ecosystems: The Dark Side of Collaborating with Complementors. MANAGEMENT SCIENCE, 62(2), 534-549 [10.1287/mnsc.2014.2140].
Mantovani, Andrea; Ruiz-Aliseda, Francisco
File in questo prodotto:
File Dimensione Formato  
Equilibrium Innovation Ecosystems.pdf

accesso aperto

Tipo: Postprint
Licenza: Licenza per accesso libero gratuito
Dimensione 416.51 kB
Formato Adobe PDF
416.51 kB Adobe PDF Visualizza/Apri

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11585/534627
Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus 67
  • ???jsp.display-item.citation.isi??? 61
social impact