This 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.

evaluating forecasts, fixedevent forecasts, forecast updates, intuition, rationality, sales forecasts
Time-Series Models; Dynamic Quantile Regressions (jel C22), Forecasting and Other Model Applications (jel C53)
Erasmus School of Economics
Econometric Institute Research Papers
Report / Econometric Institute, Erasmus University Rotterdam
Erasmus School of Economics

de Bruijn, L.P, & Franses, Ph.H.B.F. (2011). Evaluating the Rationality of Managers' Sales Forecasts (No. EI 2011-36). Report / Econometric Institute, Erasmus University Rotterdam (pp. 1–34). Erasmus School of Economics. Retrieved from