Differential game analysis of enterprise quality decision-making under dynamic competition

Abstract

Product quality decision-making is an essential part of enterprise strategic decision-making. By the approach of differential game theory, this paper puts forward a quality decision-making model with two competing enterprises under dynamic environment. The research shows that, key factors of quality decision-making include attenuation coefficient of quality credit, basic manufacturing costs, demand-price elasticity coefficient, demand-quality credit elasticity coefficient and discount coefficient. Consequently, these factors play important roles on making developing strategies for enterprises.