This paper aims to seek the innovative development strategy for a leading firm in a competitive market when considering product unreliability and risk behavior. A higher innovation level may bring about better product performance. Nevertheless, it may cause some unreliability events which might incur serious negative outcomes (e.g., products recall). Facing uncertain outcomes, the innovative firm may care more about the risk of innovation when making decisions, especially in a competitive market. We build a Stackelberg game model for a competitive market consisting of a leading firm and a competitor. The Conditional Value-at-Risk (CVaR) is used to measure the firm’s risk attitude. The optimal innovation strategy of the leading firm and the response strategy of the competitor is obtained. We find that the optimal innovation strategy takes three different forms depending on the risk attitude and the development cost of innovation. i.e., no innovation, complete innovation and partial innovation. In addition, different from most existing literature on risk-averse players’ pricing decisions, we find that a risk-averse innovative firm may set a higher price to focus on only tech-savvy consumers. Moreover, the effects of innovation are also investigated. We find that the two competing firms can achieve a win–win result by adopting an appropriate innovation strategy.

本文旨在寻求领先企业在竞争市场中考虑产品不可靠性和风险行为时的创新发展战略。更高的创新水平可能会带来更好的产品性能。然而，它可能会导致一些不可靠性事件，这些事件可能会导致严重的负面结果（例如，产品召回）。面对不确定的结果，创新企业在决策时可能更关心创新的风险，尤其是在竞争激烈的市场中。我们为由领先公司和竞争对手组成的竞争市场构建 Stackelberg 博弈模型。条件风险价值（CVaR）用于衡量公司的风险态度。获得了领先企业的最优创新策略和竞争对手的响应策略。我们发现，根据风险态度和创新的开发成本，最优创新策略采取三种不同的形式。即无创新、完全创新和部分创新。此外，与大多数关于规避风险参与者定价决策的现有文献不同，我们发现规避风险的创新公司可能会设定更高的价格以仅关注精通技术的消费者。此外，还研究了创新的影响。我们发现，两家竞争公司可以通过采用适当的创新策略实现双赢。我们发现，一家规避风险的创新公司可能会设定更高的价格，只关注精通技术的消费者。此外，还研究了创新的影响。我们发现，两家竞争公司可以通过采用适当的创新策略实现双赢。我们发现，一家规避风险的创新公司可能会设定更高的价格，只关注精通技术的消费者。此外，还研究了创新的影响。我们发现，两家竞争公司可以通过采用适当的创新策略实现双赢。