One of the important research works is corporate partnering and reliance on various forms of external collaboration. Although many researchers have focused on the knowledge-based work to help firms collaborate and share their knowledge, few have comprehensively considered the structure of network and cooperative strategies. Our paper differentiates three situations of innovation, and simulates the actions of cooperation between firms with different life cycles in industry cluster with the scale-free network structure. The simulation results show that (a) when the industry cluster develops, firms’ absorbability also is growing, but the behaviors of cooperation do not always increase as firms’ absorbability grows. Sometimes they exhibit inverted U-shape, U-shape, or liner trend. (b) Firms will cooperate to share their information or knowledge automatically if the payoff of the innovation is bigger. (c) The incentive policy does encourage the cooperation between the firms, but the incentive policy about compensation with each cooperation action is more effective than with the periodic fixed incentive.
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