Behavioral Inventory Management

34 Pages Posted: 18 May 2021 Last revised: 27 Dec 2021

See all articles by Andrew M. Davis

Andrew M. Davis

Samuel Curtis Johnson Graduate School of Management, Cornell University

Jordan Tong

Wisconsin School of Business

Date Written: May 12, 2021


Behavioral inventory-management research leverages ideas and methodologies commonly used in behavioral economics and psychology to advance our understanding of the role of human behavior in inventory management. In this chapter, we first review some of the early papers in this area organized by problem setting. We describe the history and notable papers in the two largest streams: the newsvendor and serial supply chain settings. We then discuss how behavioral science can advance inventory research by describing three different pathways for improving inventory performance: correcting sub-optimal decision behavior, responding to others’ behavioral patterns, and designing processes and systems for behavioral regularities. For each pathway, we provide recent examples from the literature. We conclude by discussing contemporary research opportunities in this sub-field involving other types of human decisions, beyond the inventory decisions typically considered.

Suggested Citation

Davis, Andrew M. and Tong, Jordan, Behavioral Inventory Management (May 12, 2021). Available at SSRN: or

Andrew M. Davis (Contact Author)

Samuel Curtis Johnson Graduate School of Management, Cornell University ( email )

Ithaca, NY 14853
United States

Jordan Tong

Wisconsin School of Business ( email )

975 University Avenue
Madison, WI 53706
United States

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