Impulse Balance and Multiple‐Period Feedback in the Newsvendor Game

Ockenfels, Axel; Selten, Reinhard

doi:10.1111/poms.12399

Cited by 13 publications

(9 citation statements)

References 36 publications

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“…There are also studies on behavioral factors that could improve decision making and mitigate risks of biased decisions in a newsvendor setting (e.g., Tomlin & Yimin, ; Bolton & Katok, ; Ockenfels & Selten, ; Ovchinnikov et al., ; Feng & Zhang, ). The ordering behavior could be affected by the background of the decisionmakers.…”

Section: Literature Classification Based On Operations Contextsmentioning

confidence: 99%

Behavioral Operations and Supply Chain Management–A Review and Literature Mapping

et al. 2019

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Behavioral operations research has proliferated greatly over the decade since its first formal review in 2006. The growth of the field warrants an objective mapping of contributions to the literature and the identification of trends. We conduct a systematic review of the literature of behavioral operations and supply chain management (BOSCM) across eight key operations and supply chain management journals, with publication dates through the end of June 2018. Collected articles are categorized into 12 operations contexts as well as emerging topic considerations. Key research trends, theoretical foundations, and methodological choices are discussed in each context. The results show that supply chain management, inventory management, and procurement/auctions have been the most popular operations contexts for BOSCM researchers. The results of our co‐citation analysis shows that the fundamental research areas that have informed and shaped the field include supply chain risk management, marketing, cognitive psychology, and social psychology. Based on these findings and a survey of the most prolific authors in the field, we discuss possible avenues for future research.

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Section: Literature Classification Based On Operations Contextsmentioning

confidence: 99%

Behavioral Operations and Supply Chain Management–A Review and Literature Mapping

et al. 2019

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“…This phenomenon is posited as a plausible reason for the pull-to-center effect. Other works examining a sequence of newsvendor decisions did not find evidence of learning (Bolton and Katok, 2008; Ockenfels and Selten, 2014).…”

Section: Primary Research Clustersmentioning

confidence: 87%

“…The impulse balance theory assumes that order quantities that vary from the optimal trigger impulses are proportionate to the costs resulting from the variation of the order quantity. A couple of works investigates the connection of this phenomenon on the newsvendor problem (Ockenfels and Selten, 2014, 2015).…”

Section: Primary Research Clustersmentioning

confidence: 99%

Inventory and ordering decisions: a systematic review on research driven through behavioral experiments

Perera

Fahimnia

Tokar

2020

IJOPM

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PurposeThe success of a supply chain is highly reliant on effective inventory and ordering decisions. This paper systematically reviews and analyzes the literature on inventory ordering decisions conducted using behavioral experiments to inform the state-of-the-art.Design/methodology/approachThis paper presents the first systematic review of this literature. We systematically identify a body of 101 papers from an initial pool of over 12,000.FindingsExtant literature and industry observations posit that decision makers often deviate from optimal ordering behavior prescribed by the quantitative models. Such deviations are often accompanied by excessive inventory costs and/or lost sales. Understanding how humans make inventory decisions is paramount to minimize the associated consequences. To address this, the field of behavioral operations management has produced a rich body of research on inventory decision-making using behavioral experiments. Our analysis identifies primary research clusters, summarizes key learnings and highlights opportunities for future research in this critical decision-making area.Practical implicationsThe findings will have a significant impact on future research on behavioral inventory ordering decisions while informing practitioners to reach better ordering decisions.Originality/valuePrevious systematic reviews have explored behavioral operations broadly or its subdisciplines such as judgmental forecasting. This paper presents a systematic review that specifically investigates the state-of-the-art of inventory ordering decisions using behavioral experiments.

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“…Forcing decisions to hold over a longer timespan (standing orders) improves decision making to some extent, both in terms of profit and in terms of probability of choosing optimal orders i.e. ordering close to optimal quantity more often (Bolton & Katok, 2008;Ockenfels & Selten, 2015). Accordingly, we formulate our second proposition: Proposition 2: Standing orders reduce short-term thinking and increase the focus on the normative newsvendor logic i.e.…”

Section: The Forecasting Newsvendormentioning

confidence: 99%