Dynamic switching strategies in China’s telecommunication industry.

• Main Authors: Zhu, Xueshu., Nguyen, Thi Thanh Huong., Teng, Sike.
• Other Authors: Huang Weihong
• Format: Final Year Project
• Language: English
• Published: 2012
• Subjects: DRNTU::Social sciences::Economic development::China; DRNTU::Social sciences::Economic theory::Microeconomics
• Online Access: http://hdl.handle.net/10356/48841
• Institution: Nanyang Technological University

This paper is based on the strategy changing dynamic theory proposed by Huang, in the application to the profit-driven competing mechanism. However, the framework of Huang’s model is perfect under a few restricted assumptions. A further study to his work is dedicated to release one of the assumptions Huang makes in his analysis. To be specific, in today’s economy, unequal power to the market exists among various players in a certain industry. Besides, not all strategies are mutually exclusive, that is some strategies can be adopted at the same time. In the light of the above facts, the assumption of equal access to all available strategies is disregarded in this thesis. In order to illustrate the implications of releasing such assumption, the thesis applies the theoretical analysis into current three players in China’s telecom industry after its reorganization in 2008. A detailed discussion is followed, where the effects of different magnitude of values assigned to several parameters are analyzed. Moreover, technical analysis is combined with certain backgrounds in the field of Industrial Organization. For example, China Mobile is regarded as the leading player while China Unicom and China Telecom compete in a subgame. Later in the thesis, the results of theoretical analysis are compared with real data, and implications of such comparison are given at the end. This research has certain limitations, but also accompanies far-reaching influence. It offers another way of understanding the strategy changing dynamics existing industries where players have unequal power. In addition, the research can also be applied to the assessment of possible outcomes under dynamic games.