Distributed investment decisions and forecasting errors: An analysis based on a multi-agent simulation model
| Autor: | Alexandra Rausch, Doris A. Behrens, Stephan Leitner |
|---|---|
| Rok vydání: | 2017 |
| Předmět: |
050208 finance
Information Systems and Management Actuarial science General Computer Science media_common.quotation_subject 05 social sciences Management Science and Operations Research Investment (macroeconomics) Industrial and Manufacturing Engineering Investment decisions Modeling and Simulation Cash 0502 economics and business Cash flow Business 050207 economics media_common Overconfidence effect |
| Zdroj: | European Journal of Operational Research. 258:279-294 |
| ISSN: | 0377-2217 |
| Popis: | This paper analyzes the impact of both non-systematic and systematic forecasting errors on the coordination of distributed investment decisions. The forecasts of concern pertain to the expected cash outlay necessary to launch and operate an investment project, to the expected cash flows generated by the project’s operation, and to the self-assessment of whether or not the abilities expected to be needed for operation coincide with one’s own. Systematic forecasting errors manifested by systematically over- or underestimating these predicted project indicators are interpreted as being produced by overconfidence. Utilizing a multi-agent simulation approach, we show that within a hierarchical business organization with distributed authorities for decision making, in some cases being overconfident can mitigate the negative effect of erroneous forecasting compared to being non-systematically wrong. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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