Game Theory in Strategic Management-Dynamic Games. Theoretical and Practical Examples

Game Theory provides an analysis tool for describing the decision-making process of one or more players, their behavior when there are plenty of possible outcomes. Strategic behavior is a generic term that designates all concerted and consistent actions promoted by an enterprise in order to influence the competitive environment or at least to adapt to its evolution. This paper aims at exploring the real potential of strategic management based on dynamic game theory decisions and illustrates that the usefulness and power of game theory applied in strategic management lie in its ability to provide insights on competitive climate and strategies. In this paper, we will investigate some potential contributions of game theory to strategic management, especially with regard to applications in individual industries. The examples presented in the second part of the paper are based on strategic management decisions that involve dominant strategies

Building an Optimal Portfolio Consisting of two Assets and Its Efficient Frontier

In modern portfolio theory, it is common practice to first compute the risk-reward efficient frontier and then to support an individual investor in selecting a portfolio that meets his/her preferences for profitability and risk. Potential flaws include (a) the assumption that past data provide sufficient evidence for predicting the future performances of the securities under consideration and (b) the necessity to mathematically determine or approximate the investor’s utility function. This paper presents the description of the efficient frontier for a portfolio made of two assets. We use data analysis to obtain two clusters, then, we estimate the risk of each asset corresponding to each class we obtained. Thus, we get the best two assets among the ones we analyzed and for which we will construct the efficient frontier. The originality of our paper consists in the combination of classification theory and risk estimation theory to determine the best assets. To illustrate the efficiency of the method we used, we present a case study which makes reference to the stocks listed at Bucharest Stock Exchange. We consider two stocks with the best features from Bucharest Stock Exchange based on the existent correlation that we obtained by data analyses (for classification), and by the evaluation of the loss repartition (for risk estimation), then we construct the efficient frontier for this portfolio.risk, selection of assets, principal components analysis, optimization, efficient frontier

An analysis of the economic performances of the retail companies in Romania

Based on the finding of the economic studies on the analysis of the performances of the companies from retails sector, this paper aims of analyzing the economic factors which are the basis of economic performances of the new companies from the retails sector of Romania. Starting with an econometric model based on current assets, fixed assets and number of employees, three research hypotheses were tested and validated through a multilinear regression model analyzed with the OLS method with the use of statistical software SPSS 23. The conclusions of the paper are in line with the other researches in the area and underline that the economic performances of the selected companies are determined by the current and fixed assets, as well as the number of employees

The Role of Knowledge Intensive Business Services on Romania’s Economic Revival and Modernization at the Regional Level

Knowledge intensive business services have recently become one of the most important themes addressed by researchers in the field. Their interest in such a subject is due primarily to the impact they have in terms of growth rate, especially for the economies of emerging countries. The literature in the field brings a series of persuasive arguments about the role that these services have both at national and regional levels. In this paper, the authors make a radiography of the Romanian research system which is passing through a transition phase from the ruins of communism to the challenges of globalization. Moreover, the authors analyse the role of performance-based services in Romania’s regional development in correlation with the economic growth target at the national scale. Quantitative methods used during the present paper highlight the disparities between Romania’s geographic regions in terms of technological development and research. In addition, the econometric model developed in the study emphasizes the cohesion degree corresponding to the European Union Member States

The Impact of Applying the Total Quality Management Model on the Performance of the Telecom Organizations in Romania

The present paper brings into discussion Edwards Deming’s conceptualized model of Total Quality Management highlighting different phases within its evolution as it is seen in the economic literature. A temporal incursion allows a better understanding of the way quality standards implemented by means of total quality management programs are reflected in final consumer’s satisfaction as well as in organizations’ long-term performance. Conceptual development of the model is intertwined with the pragmatic side, by presenting a case study of the mobile telecommunication sector in Romania. The quantitative research analyzes the influence of total quality management’s (TQM) implementation in achieving the competitive advantage and the performance of enterprises in the telecom sector. Data were collected by means of a survey through a questionnaire addressed to the respondents and the hypotheses of structural equation modeling (SEM) were tested by partial least squares path modeling (PLS). Data analysis was conducted by means of the statistical software SmartPLS 2.0 M3 software. The research conclusions confirm the theoretical issues presented throughout the paper, emphasizing the fact that enterprises’ performance is the direct result of the collaboration between a series of factors such as the motivated workforce, decisional power quality as well as operational process integrity

Detecting Bid-Rigging in Public Procurement. A Cluster Analysis Approach

This paper analyses the public procurement auctions for snow removal contracts to find out whether bid-rigging occurred. Due to the limited participation in the auction processes, detection of anticompetitive agreements was possible. The econometric analysis used in our study supported the findings of a cartel agreement. Cluster analysis, statistical hypothesis, normality and symmetry and nonparametric tests reveal two types of auctions: competitive and noncompetitive bids. The aim of this paper is to analyze the public procurement auctions with nonparametric statistical methods. Our findings are in line with the literature in the field

An Application of the Kalman Filter Recursive Algorithm to Estimate the Gaussian Errors by Minimizing the Symmetric Loss Function

Kalman filtering is a linear quadratic estimation (LQE) algorithm that uses a time series of observed data to produce estimations of unknown variables. The Kalman filter (KF) concept is widely used in applied mathematics and signal processing. In this study, we developed a methodology for estimating Gaussian errors by minimizing the symmetric loss function. Relevant applications of the kinetic models are described at the end of the manuscript

An Application of the Kalman Filter Recursive Algorithm to Estimate the Gaussian Errors by Minimizing the Symmetric Loss Function

Kalman filtering is a linear quadratic estimation (LQE) algorithm that uses a time series of observed data to produce estimations of unknown variables. The Kalman filter (KF) concept is widely used in applied mathematics and signal processing. In this study, we developed a methodology for estimating Gaussian errors by minimizing the symmetric loss function. Relevant applications of the kinetic models are described at the end of the manuscript

Research on the Factors of Competition in the Green Procurement Processes: A Case Study for the Conditions of Romania Using PLS-SEM Methodology

In this paper, starting from the conceptual model of the rational behavior theory developed by Icek Ajzen, the authors develop a behavioral model of rational expectations of the managerial decisions in order to determine the influence of the behavior of the undertakings on a competitive environmental market. The data were collected between 1 May 2019–30 June 2019 with the help of a questionnaire addressed to the employees and managers of the companies engaged in the green procurement processes in Romania. The sample volume was 160 and the data was analyzed with partial least square structural equation modeling (PLS-SEM) method and by using the statistical software Smart-PLS 3.2.8. Starting from the relevant economic literature in the field of rational behavior, the article identifies the behavioral indicators that underlie the decision to invest in this market. These indicators are the independent variables that model the impact of rational behavioral theory on managerial decisions. The conclusions of the study confirm the theoretical aspects presented in the article, emphasizing that the managerial decisions based on rational behavior theory are the direct result of the cooperation of several factors, such as the strategic vision, innovation, regulation, and the level of competences of the human factor