Forecasting long‐term paper demand in emerging markets

Abstract

PurposeTypically, the graphic paper demand is being forecasted with the development of GDP, population and the price of paper. Recently, diffusion of information and communication technologies (ICT) has been identified as one possible driver of its consumption. It could be assumed that in emerging markets paper demand is a combination of these classical and new factors.Design/methodology/approachThe research examines the situation in the emerging Russian market with panel data regression analysis, accompanied with system dynamics simulation using Monte Carlo sensitivity analysis. So, the paper integrates different quantitative approaches to sketch long‐term paper demand forecasts through different alternative scenarios.FindingsResults show that mobile telephones are complementary to both newsprint and magazine paper demand and the internet is a substitute, but these two factors are still relatively small compared to the effect of GDP per capita.Research limitations/implicationsThis research is limited to Russian markets, and in order to have more generalization power, it should be repeated in other emerging economies like, for example, former East European countries and Asia. However, used data in our analysis is longitudinal and has numerous observation points; therefore giving more reliability over the results.Originality/valueThe research work is seminal from the methodological point of view: it incorporates numerous quantitative methods to produce demand forecast using Monte Carlo simulation. Also, research studies taking into account the impact of ICT on emerging markets concerning paper demand are rare.