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Comment on "Newsvendor Demand Chasing Revisited"
Journal article   Peer reviewed

Comment on "Newsvendor Demand Chasing Revisited"

Samuel N. Kirshner and Brent B. Moritz
Management science, Vol.66(12), pp.6062-6064
12/01/2020
DOI: 10.1287/mnsc.2019.3489

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Abstract

Based on a simulation, the authors of "Newsvendor Demand Chasing Revisited" recommended using correlation of orders with lagged demand to measure chasing behavior. They concluded that measuring chasing with regression based on partial adjustment is prone to false positives. We show the purported false positives are due to autocorrelation and recommend using partial adjustment regression-based approaches to evaluate chasing.
Business & Economics Management Operations Research & Management Science Science & Technology Social Sciences Technology

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