Balancing Expert Opinion and Historical Data: The Case of Baseball Umpires
Journal of Cost Analysis and Parametrics
Many decisions benefit from situations where there exist both ample expert opinion and historical data. In cost modeling these may include the costs of software development, the learning curve rates for specific manufacturing tasks, and the unit rate costs of operating certain products. When making forecasts we are often faced with the decision to base our estimates on either expert opinion or historical data. When these two perspectives converge, we have high confidence in the estimate. The more interesting case is when they contradict. This is where the estimator needs to dig deeper in order to determine the sources of inconsistencies.
Ricardo Valerdi is an Associate Professor of Systems & Industrial Engineering and Director of the Sports Management Program at the University of Arizona. He is a Visiting Fellow of the Royal Academy of Engineering (UK) and a member of the Mexican Academy of Engineering. He obtained his Ph.D. from the University of Southern California.