Utilizing a Fractional-Order Grey Model to Predict the Development Trends of China’s Electronic Commerce Service Industry

Abstract

Electronic commerce plays a vital role in the digital age, and the creation of a good electronic commerce ecosystem is crucial to maintaining economic growth. The electronic commerce service industry is a leading indicator of electronic commerce development, and its possible changes imply the future trends and innovation directions of the electronic commerce industry. An accurate grasp of the possible future revenue scale of the electronic commerce service industry can provide decision-making information for government policy formulation. Electronic commerce companies must formulate operational plans based on the latest information to determine strategic directions that are reasonable and consistent with the actual situation. Although there exist many prediction methods, they often fail to produce ideal results when the number of observations is insufficient. The fractional-order grey model is a common method used to deal with small data set prediction problems. This study therefore proposes a new modeling procedure for the fractional-order grey model to predict the revenue scale of China’s electronic commerce service industry. The results of experiments demonstrate that the proposed procedure can yield robust outputs under the condition of small data sets to reduce decision-making risks. Therefore, it can be regarded as a practical small data set analysis tool for managers.