@conference{Hosoda2008, author = {T. Hosoda and S.M. Disney}, title = {On market demand misspecification in a two-level supply chain}, booktitle = {Thirteenth Manufacturing and Service Operations Management Conference}, year = {2008}, pages = {6 pages}, address = {University of Maryland, USA}, month = {5th-6th June}, url = {https://www.researchgate.net/publication/395411623_On_market_demand_mis-specification_in_a_two-level_supply_chain}, abstract = {This paper investigates the impact of mis-specifying the market demand process on a serially linked two-level supply chain. Box-Jenkins models are used to represent both the true market demand process and a mis-specified model of the market demand process. Our analysis suggests that mis-specification does not always result in additional costs. Indeed by exploiting mis-specification, the supply chain can reduce both the total supply chain inventory and the production costs simultaneously. A managerial insight is revealed: Poor forecast accuracy is not always bad for the supply chain costs, from a total cost viewpoint. In other words, employing more accurate forecasting methods may actually result in higher total supply chain costs.} }