Newsvendor models with alternative risk preferences within expected utility theory and prospect theory frameworks

Charles X. Wang, Scott Webster, Sidong Zhang

Research output: Chapter in Book/Report/Conference proceedingChapter

3 Scopus citations

Abstract

Newsvendor models are widely used in the literature, and usually based upon the assumption of risk neutrality. Recently there is a growing body of literature that attempts to use alternative risk preferences rather than risk neutrality to describe the newsvendor decision-making behavior. In this chapter, we provide an overview of newsvendor models with alternative risk preferences within the expected utility theory and prospect theory frameworks and identify some directions for future research.

Original languageEnglish (US)
Title of host publicationInternational Series in Operations Research and Management Science
PublisherSpringer New York LLC
Pages177-196
Number of pages20
Volume176
DOIs
StatePublished - 2012
Externally publishedYes

Publication series

NameInternational Series in Operations Research and Management Science
Volume176
ISSN (Print)08848289

Keywords

  • Behavioral operations management
  • Expected utility theory
  • Loss aversion
  • Newsvendor model
  • Prospect theory
  • Risk aversion

ASJC Scopus subject areas

  • Management Science and Operations Research
  • Strategy and Management
  • Applied Mathematics
  • Computer Science Applications
  • Software

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  • Cite this

    Wang, C. X., Webster, S., & Zhang, S. (2012). Newsvendor models with alternative risk preferences within expected utility theory and prospect theory frameworks. In International Series in Operations Research and Management Science (Vol. 176, pp. 177-196). (International Series in Operations Research and Management Science; Vol. 176). Springer New York LLC. https://doi.org/10.1007/978-1-4614-3600-3_7