Abstract:Based on the theory of evolutionary game, this paper constructs a dynamic replication system of Chinese manufacturing enterprises and leading enterprises in developed countries, uses MATLAB numerical simulation analysis method to explore the dynamic evolution path of functional upgrading of Chinese manufacturing enterprises and factors affecting strategy selection of both parties. It is found that there are three evolutional stabilization strategies in the dynamic replication system of Chinese manufacturing enterprises, and which stabilization strategy eventually tends to depend on the income matrix and parameter changes, the increase of income after the enterprise function upgrade and the decrease of extra cost to realize the function upgrade will increase the possibility of the enterprise to carry on function upgrade. To this end, the paper proposes that Chinese manufacturing enterprises should improve the function upgrade and reduce the obstacles caused by leading enterprises by constructing domestic value chain, reducing direct competition with leading enterprises and increasing cooperation with leading enterprises.