Template-Type: ReDIF-Paper 1.0
Author-Name: Franses, Ph.H.B.F.
Author-Name-Last: Franses
Author-Name-First: Philip Hans
Author-Person: pfr226
Author-Name: Legerstee, R.
Author-Name-Last: Legerstee
Author-Name-First: Rianne
Title: A Manager's Perspective on Combining Expert and Model-based Forecasts
Abstract: We study the performance of sales forecasts which linearly combine model-based forecasts and expert forecasts. Using a unique and very large database containing monthly model-based forecasts for many pharmaceutical products and forecasts given by thirty-seven different experts, we document that a combination almost always is most accurate. When correlating the specific weights in these "best" linear combinations with experts' experience and behaviour, we find that more experience is beneficial for forecasts for nearby horizons. And, when the rate of bracketing increases the relative weights converge to a 50%-50% distribution, when there is some slight variation across forecasts horizons.
Creation-Date: 2007-12-06
File-URL: https://repub.eur.nl/pub/10769/ERS-2007-083-MKT.pdf
File-Format: application/pdf
Series: RePEc:ems:eureri
Number: ERS-2007-083-MKT
Classification-JEL: C44, C53, L81, M, M31
Keywords: combining forecasts, experts forecast, model-based forecasts
Handle: RePEc:ems:eureri:10769