Implicit Attitudes Towards Risk: Influences on Newsvendor Inventory Decisions

This study addresses the role of implicit attitudes toward risk in inventory management, specifically in the context of the newsvendor problem (NVP). Using the Implicit Association Test (IAT), we explore how implicit attitudes toward risk influence newsvendors’ ordering decisions, focusing on deviations from profit-maximising solutions. Our methodology combines the NVP inventory exercise with IAT measurements. We find a negative correlation between participants’ implicit attitudes toward risk and the absolute deviation from the optimal order quantity, indicating that individuals with implicit attitudes toward risk are closer to neutrality deviate less from the profit-maximising solution. This supports our hypothesis that implicit risk attitudes impact such deviations. Our findings emphasise the importance of considering implicit attitudes toward risk in decision support systems for inventory management. Future research directions should explore the interplay of implicit attitudes toward risk with cognitive factors and its applicability in diverse contexts.