Title

Risk pooling, supply chain hierarchy, and analysts’ forecasts

Document Type

Journal article

Source Publication

Production and Operations Management

Publication Date

6-6-2018

Volume

Advance online publication

Publisher

Wiley-Blackwell Publishing, Inc.

Abstract

We investigate whether a firm's risk pooling affects its analysts’ forecasts, specifically in terms of forecast accuracy and their use of public vs. private information, and how risk pooling interacts with a firm's position in the supply chain to affect analysts’ forecasts. We use a social network analysis method to operationalize risk pooling and supply chain hierarchy, and find that risk pooling significantly reduces analysts’ forecast errors and increases (decreases) their use of public (private) information. We also find that the positive (negative) relationships between risk pooling and analyst forecast accuracy and analysts’ use of public (private) information are more pronounced upstream than downstream in a supply chain.

DOI

10.1111/poms.12904

Print ISSN

10591478

E-ISSN

19375956

Funding Information

Professor Hu is grateful for the financial support from the National Natural Science Foundation of China (grant number: 71772150) and Young Talent Recruiting Plans of Xi’an Jiaotong University (grant number GL1J009).

Publisher Statement

Copyright © 2018 Production and Operations Management Society. Access to external full text or publisher's version may require subscription.

Full-text Version

Publisher’s Version

Language

English

Recommended Citation

Hu, N., Ke, J.-Y.(F.), Liu, L., & Zhang, Y. (2018). Risk pooling, supply chain hierarchy, and analysts’ forecasts. Production and Operations Management. Advance online publication. doi: 10.1111/poms.12904

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