Abstract

This paper investigates the dynamic coopetition and capacity-sharing strategies between an Integrated Manufacturer and a Developer under R&D uncertainty, focusing on the governance of strategically scarce capacity. By constructing a two-stage game model, we analyze how government intervention and risk-hedging mechanisms influence the allocation of idle strategically scarce capacity in innovation-driven industries. The findings reveal a two-sided paradoxical behavioral pattern: in the low-probability R&D interval, rather than relying on safe contract manufacturing, the Integrated Manufacturer counter-intuitively reduces collaborative duration to aggressively gamble on its immature product. Conversely, in the high-probability R&D interval, where conventional wisdom predicts an aggressive pivot to self-production, the manufacturer paradoxically extends or maintains the contract manufacturing duration, driven by the partner’s full cost-sharing incentive mechanism. Furthermore, To maximize the total supply output of strategically scarce resources during collaboration, we uncover a non-linear ‘counterproductive subsidy trap’ and propose a binary ‘critical mass’ policy rule: governments should either withhold subsidies entirely or commit sufficient funding to bypass the supply deficit zone. This framework provides a theoretical foundation for managing scarcity in capital-intensive sectors such as biopharmaceuticals and semiconductors.

IPC Classification

Keywords