IDEAS home Printed from https://ideas.repec.org/a/wly/mgtdec/v19y1998i3p179-187.html
   My bibliography  Save this article

Forecasting among alternative strategies in the management of uncertainty

Author

Listed:
  • Tobias F. Rötheli

    (Department of Economics, University of Bern, Bern, Switzerland)

Abstract

This paper explores why expectations elicited from corporate decision-makers may fall short of the rational expectations ideal: the formation of an informed forecast may just not be part of the optimal management of uncertainty. The analysis of an investment decision shows that when forecasting is expensive, this strategy is likely to be superseded by the possibility to wait, to switch between projects, or the alternative to eliminate inferior projects over time. Even at low forecasting costs it may be optimal not to forecast and instead to diversify over different projects. © 1998 John Wiley & Sons, Ltd.

Suggested Citation

  • Tobias F. Rötheli, 1998. "Forecasting among alternative strategies in the management of uncertainty," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 19(3), pages 179-187.
    • Handle: RePEc:wly:mgtdec:v:19:y:1998:i:3:p:179-187
    DOI: 10.1002/(SICI)1099-1468(199805)19:3<179::AID-MDE878>3.0.CO;2-K
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Giovanna Lo Nigro & Azzurra Morreale & Lorenzo Abbate, 2016. "An Open Innovation Decision Support System to Select a Biopharmaceutical R&D Portfolio," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 37(6), pages 392-406, September.
    2. Ghosal, Vivek, 2007. "Small is Beautiful but Size Matters: The Asymmetric Impact of Uncertainty and Sunk Costs on Small and Large Businesses," MPRA Paper 5461, University Library of Munich, Germany.
    3. Jonathan P. O'Brien & Timothy B. Folta & Douglas R. Johnson, 2003. "A real options perspective on entrepreneurial entry in the face of uncertainty," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 24(8), pages 515-533.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:mgtdec:v:19:y:1998:i:3:p:179-187. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/7976 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.