Game theory in strategic analysis

Game theory has been recognized as a rigorous and elegant methodology for analysis of rivalry situations. However, its usage as a tool for strategic analysis is little and few applications of it in business practice have been formally studied. The strength of this technique lies in the powerful heuristics that it provides for analysis of complex managerial situations involving dilemmas. This paper attempts to demonstrate the application of game theory in a study of two contemporary Indian joint ventures that had similar starting characteristics but contrasting outcomes.