Abstract: On the condition of incomplete information, a game model is used to investigate the impact of ownership level and learning ability on the stability of technology innovation alliance from a perspective of knowledge transfer. The decision-making processes of involved parties are divided into two stages in the model. In the first stage, the firm possessing advanced technology decides on the level of knowledge that transfers to its alliance partners. In the second stage, based on two factors, that is, the level of knowledge learned and profits gained, the alliance members decide on whether to maintain or terminate the alliance. The outcomes of the Cournot-Nash equilibrium in the model are able to reveal when the parties decide to maintain or terminate the alliance. The model explores the status of alliance stability under different ownership levels and learning abilities in order to provide theoretical support for the selection of optimal dynamic competitive-cooperative relationship and alliance operations.

Key words: technology innovation alliance, knowledge transfer, alliance stability, dynamic Game