The Impact of Big Data on Firm Performance: An Empirical Investigation
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pandp.20191000.pdf
Description
Published version
Size
535.27 KB
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Author(s)
Bajari, Patrick
Chernozhukov, Victor V
Hortaçsu, Ali
Suzuki, Junichi
Date Issued
May 1, 2019
Publisher
American Economic Association
Citation
Bajari, Patrick, Chernozhukov, Victor, Hortaçsu, Ali and Suzuki, Junichi. 2019. "The Impact of Big Data on Firm Performance: An Empirical Investigation." 109.
Version
Final published version
Abstract
We examine the impact of “big data” on firm performance in the context of forecast accuracy using proprietary retail sales data obtained from Amazon. We measure the accuracy of forecasts in two relevant dimensions: the number of products (N), and the number of time periods for which a product is available for sale (T). Theory suggests diminishing returns to larger N and T, with relative forecast errors diminishing at rate 1/sqrt(N)+1/sqrt(T). Empirical results indicate gains in forecast improvement in the T dimension but essentially flat N effects.
MIT Department
Massachusetts Institute of Technology. Department of Economics
Terms of Use
Article is made available in accordance with the publisher's policy and may be subject to US copyright law. Please refer to the publisher's site for terms of use.
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DOI of Published Version
https://doi.org/10.1257/pandp.20191000
