Evaluating the Rationality of Managers' Sales Forecasts
AbstractThis paper deals with the analysis and evaluation of sales forecasts of managers, given that it is unknown how they constructed their forecasts. Our goal is to find out whether these forecasts are rational. To examine deviations from rationality, we argue that one has to approximate how the managers could have generated the forecasts. We describe several ways to construct these approximate expressions. The analysis of a large set of a single manager's forecasts for sales of pharmaceutical products illustrates the practical usefulness of our methodology.
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Bibliographic InfoPaper provided by Erasmus University Rotterdam, Econometric Institute in its series Econometric Institute Report with number EI 2011-36.
Date of creation: 14 Nov 2011
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Web page: http://www.few.eur.nl/few
evaluating forecasts; intuition; rationality; fixedevent forecasts; forecast updates; sales forecasts;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-11-21 (All new papers)
- NEP-FOR-2011-11-21 (Forecasting)
- NEP-HME-2011-11-21 (Heterodox Microeconomics)
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