Incorporating wealth information into a multiple criteria decision making model

Karasakal E., Michalowski W.

EUROPEAN JOURNAL OF OPERATIONAL RESEARCH, vol.150, no.1, pp.204-219, 2003 (SCI-Expanded) identifier identifier

  • Publication Type: Article / Article
  • Volume: 150 Issue: 1
  • Publication Date: 2003
  • Doi Number: 10.1016/s0377-2217(02)00468-x
  • Journal Name: EUROPEAN JOURNAL OF OPERATIONAL RESEARCH
  • Journal Indexes: Science Citation Index Expanded (SCI-EXPANDED), Scopus
  • Page Numbers: pp.204-219
  • Keywords: multiple criteria analysis, behavioral considerations, decisional wealth, trade-offs, CHOICE
  • Middle East Technical University Affiliated: Yes

Abstract

We describe how a multiple criteria decision making (MCDM) modelling framework can be extended to account for one of the behavioral ramifications of a decision making activity, namely, the decision maker's (I)M's) perception of his/her current wealth status, referred to as decisional wealth. Within the MCDM framework, decisional wealth reflects the relative achievements of each of the objectives in a given efficient solution. It is our argument that a DM's preferences and the importance of his/her objectives, vary depending on the decisional wealth. Therefore, we use the wealth information and trade-off analysis to guide the search for preferred outcomes. We identify efficient solutions that satisfy a DM's wealth-dependent preferences, and we illustrate the proposed modelling framework with an example. (C) 2002 Elsevier Science B.V. All rights reserved.