Evolutionary Dynamics for Firm's Organizational Mode based on Theory of Learning in Games

This article studies the evolutionary dynamics of the firm's organizational mode by applying the theory of learning in games. It is assumed that the firms are bounded rationally and are myopic, and they choose the organizational mode in terms of their own preferences and the market share of the organizational mode. Considering entry behavior of the firms, this article presents one-population evolutionary dynamics and the adaptive learning algorithm. Furthermore, it turns out that the profit function greatly impact on the evolutionary equilibria. On the basis of the internal spillover effect within the population and external spillover effect of two populations, it develops the corresponding two-population evolutionary dynamics and discusses the evolutionary equilibria and their basins of attraction. Theoretical analysis and numerical examples show that the evolutionary equilibria for the firms' organizational mode depend on the spillover effect from the perspectives of long run.