Partner's cooperative behaviour in gathered R&D alliances based on R&D spillovers

This paper studies on how members of alliance's investment policies are influenced by R&D spillovers, control on own R&D spillovers and innovation ability, and determines the optimal allocation that the alliances obtain the maximum expected investment. This research shows following conclusions: 1) R&D spillovers and innovation ability have positive effects to increase members' R&D investment, and control on own R&D spillovers has negative effects to members' R&D investment, but its influence is weak. 2) The equal profit-sharing arrangement is the optimal profit-sharing arrangement to the alliances with strong innovation ability. For alliances with weak innovation ability, it should choose proportional profit- sharing arrangement when market profits are low, and should choose equal profit-sharing arrangement when market gains are high.