Abstract: This study, grounded in game theory, constructs an explanatory framework for the generation and evolution of institutions. It analyzes the trajectory from key universities construction initiative to Double First-Class Initiative, exploring how the new Initiative breaks through identity constraints, reconstructs the underlying mechanisms of open competition and innovation, and clarifies the institutional logic of initiative evolution. The results indicate that changes in external environmental factors, such as the shift in central government strategic goals, have generated opportunities for incremental resource allocation and redistribution, providing the motivation for the construction of the Double First-Class Initiative. The involvement of local governments and local universities as main participants in the game has overcome the drawbacks of designed resource allocation, shaping a new landscape of open competition with multiple participants. Driven by the new rules of the game, the central government, local governments and higher education institutions gradually alter their subjective game models, concentrating on developing advantageous disciplines with incremental resources, thereby providing endogenous forces for entry into the Double First-Class ranks. Overall, the Double First-Class Initiative has achieved relatively good results, creating an open, competitive and dynamic institutional environment. On the other hand, it has built a distinctive Chinese model for the development of first-class universities and disciplines. In the future, it will be necessary to manage the relationship between external governance and internal games, as well as the balance between the clustering of first-class universities and the equilibrium of the higher education system.