Decision Theory

Decision Theory

  • Faris Alshubiri added an answer:
    Does anyone know about Analytical Hierarchy Process as an analysis tool for flexibility?

    Seek your advise on how to use this method. Thank you.

    Faris Alshubiri

    Dear Perumal Ponnusamy

    See the attached file , may be help you about hoe to analysis Hierarchy Process .

    Best Regards

  • Linh Chi Nguyen added an answer:
    What is the formal difference between the player and the agent in game theory?
    I am considering the relation between a player and his agent or agents in definition of the game.
    Linh Chi Nguyen

    yes there is formal difference between "player" and "agent".

    i dont remember the paper but Binmore et al call "player" in a game and "agent" in population. that's indeed a fundamental difference.

    a game is an abstract context, for example, in PD, there are 2 players (2 prisoners)

    if we simulate a population playing this PD game, the machines/automata in the population are called the agents.

  • Linh Chi Nguyen added an answer:
    Except for the Frame Selection Theory of Esser and Kroneberg, are there any other attempts of unifying Schütz' Theory and Decision Theory?

    I'm looking for theories or models which try to combine or to unify the theory of Alfred Schütz with common theories of explaining action via decision models like Rational Choice or Bounded Rationality models. The Frame Selection Theory of Hartmut Esser and Clemens Kroneberg is well known to me but I wonder whether there are similar but independent attempts.

    Linh Chi Nguyen

    the thing is phenomology is to study "how a group of individuals come together and interact". (like network, complexity)

    bounded rationality, rational choice is decision theory at the level of individuals.

    they dont really need to be "unified" if you mean blending them together. they survive separately because they operate at different levels.

    for example, evolutionary game theory studies how a population of (bounded or unbounded) individuals evolve over time.

    ps. why is there so few google results on "frame selection theory"

  • Mohamad Amin Kaviani added an answer:
    Fuzzy decision making, Intuitionistic Fuzzy decision making or Grey decision making method- which one is more applicable?

    I was thinking about the different decision making methods under certain and uncertain conditions. My specific question is that:

    As you know, we have many MCDM tools like AHP- ANP- TOPSIS- VIKOR- PROMOTEE- MOORA- SIR and many other methods and all of them have been developed to fuzzy, type-2 fuzzy, intuitionistic fuzzy and Grey environments. But when we deal with uncertainty, we actually do not know which one of the aforementioned conditions is more appropriate. Which one really more applicable under uncertain situation? fuzzy ? type-2 fuzzy? Intuitionistic fuzzy? or Grey environment for a decision making method?

    All the ideas and comments are appreciated. Hope that all of the experts take an action to this question by following or leaving their valuable comments. 

    Mohamad Amin Kaviani

    Dear colleagues, 

    I am so happy that my question has been taken into your considerations. I think the subject of this question can push out the frontier of uncertain decision making researches and is a challenging topic.

  • Linh Chi Nguyen added an answer:
    Does anyone know of a quick way to create the illusion of free agency in an experimental setting?

    I need a quick way to get participants to think/act as if they have made their own choice, while actually have their choice correspond to their assigned condition. In other words, I am looking for a way to get them to "choose" their assigned condition. 

    I am considering offering multiple choices (out of 4) and telling them that their choice has to match a random selection in order for the task to begin. But wondering if there is a better, more efficient way to do this.

    Linh Chi Nguyen

    This is deception. I think deception is outright forbidden in experimental economics?
    But psychologists are fine with deception. Let some psychologists in. (I've heard so).

    Anyway, making people choose the condition we want messes with their mental mind. Maybe it affects their behavior, though unconsciously. Anyway, if it's just for the unimportant beginning, maybe it's fine.

  • Marco Egle added an answer:
    What is the best way for building an individual discounting function for testing each subject's discounting utility rate?

    In intertemporal choice paradigms, I would like to build a discount utility function for each participant in my study based on a couple of intertemporal decisions performed by each participant. Is there any software that can easily perform such calculations? 

    Is matlab the most appropriate software for doing this?

    Marco Egle

    that's a nice idea

    Thank you!!

  • Elisa Battistoni added an answer:
    How to get a limit matrix from weighted supermatrix in ANP(Analytical Network Process) ?

    I have a weighted supermatrix and I am trying to convert it into a limit matrix.

    Weighted supermatrix can be transformed into the limit supermatrix
    by raising itself to powers until the matrix converges

    How it can be performed ?

    Elisa Battistoni

    The weighted supermatrix comes out from the combination of the unweighted supermatrix and the control hierarchy. The latter scores the priority of a cluster over all the clusters to which it is connected: therefore, the control hierarchy is an n*n matrix, with n=number of clusters in the network. To build the control hierarchy matrix, first of all you choose a cluster Ci. Then, all other clusters connected with Ci are pairwise compared (with AHP) to determine their impact on Ci; their weights are listed in the control hierarchy matrix. For all the clusters that are not connected to Ci the corresponding element in the control hierarchy is set to 0.

    Now, all elements in the block corresponding to the intersection between cluster Ci and cluster Cj in the unweighted supermatrix can be multiplied by the weight of Ci over Cj listed in the control hierarchy matrix. In this way, you can obtain your weighted supermatrix.

  • Wald Koczkodaj added an answer:
    In Analytical Hierarchy Process Is there a way to justify CR>0.1?

    I conducted AHP using 3 pairwise comparisons. Unfortunately the CR comes out as 0.302. A balanced scale using principal eigen vectors also results in a CR of 0.22. Is there any way to be able to move forward with these results?

    Wald Koczkodaj

    Seyed, I highly recommend Section 5 in:

    and text before conclusions.

    They show that even CR<0.1 does not guarantee since CR is mathematically WRONG  and its creator is aware of it. Counterexamples show that CR tolerates errors of any arbitrary value (e.g., 1,000,000%+). It has recently generated controversy on the international level:

    with responses:

    since the eigenvector method has not solved the Middle East problems.

    More is posted here:

    The Analytic Hierarchy Process-Is it old and Outdated? - ResearchGate. Available from: [accessed Sep 7, 2015].

    AHP should not be equalized with pairwise comparisons.

    AHP has not "aged" (not sound theory "ages; think about the integral).

    It has never flawed from day #1 as many researchers signaled.

  • Ibsen Chivatá Cárdenas added an answer:
    What is the best method for decision making under uncertainty?
    • Stochastic techniques
    • Robust optimization 
    • Fuzzy methods
    • Information Gap Decision Theory
    • Z-number
    • Source
      [Show abstract] [Hide abstract]
      ABSTRACT: The energy system studies include a wide range of issues from short term (e.g. real-time, hourly, daily and weekly operating decisions) to long term horizons (e.g. planning or policy making). The decision making chain is fed by input parameters which are usually subject to uncertainties. The art of dealing with uncertainties has been developed in various directions and has recently become a focal point of interest. In this paper, a new standard classification of uncertainty modeling techniques for decision making process is proposed. These methods are introduced and compared along with demonstrating their strengths and weaknesses. The promising lines of future researches are explored in the shadow of a comprehensive overview of the past and present applications. The possibility of using the novel concept of Z-numbers is introduced for the first time.
      Renewable and Sustainable Energy Reviews 12/2013; 28:376-384. DOI:10.1016/j.rser.2013.08.039
    Ibsen Chivatá Cárdenas

    Another paper addressing your question is the following:

    Lempert, R. J., & Collins, M. T. (2007). Managing the risk of uncertain threshold responses: comparison of robust, optimum, and precautionary approaches. Risk analysis, 27(4), 1009-1026.

    • Source
      [Show abstract] [Hide abstract]
      ABSTRACT: Many commentators have suggested the need for new decision analysis approaches to better manage systems with deeply uncertain, poorly characterized risks. Most notably, policy challenges such as abrupt climate change involve potential nonlinear or threshold responses where both the triggering level and subsequent system response are poorly understood. This study uses a simple computer simulation model to compare several alternative frameworks for decision making under uncertainty -- optimal expected utility, the precautionary principle, and three different approaches to robust decision making -- for addressing the challenge of adding pollution to a lake without triggering unwanted and potentially irreversible eutrophication. The three robust decision approaches -- trading some optimal performance for less sensitivity to assumptions, satisficing over a wide range of futures, and keeping options open -- are found to identify similar strategies as the most robust choice. This study also suggests that these robust decision approaches offer a quantitative, decision analytic framework that captures the spirit of the precautionary principle while addressing some of its shortcomings. Finally, this study finds that robust strategies may be preferable to optimum strategies when the uncertainty is sufficiently deep and the set of alternative policy options is sufficiently rich.
      Risk Analysis 09/2007; 27(4):1009-26. DOI:10.1111/j.1539-6924.2007.00940.x
  • Devendra Swami added an answer:
    Does anyone have an example of a query used to consult experts in the aim of the Analytic Hierarchy Process?

    The Analytic Hierarchy Process - AHP (Saaty 1980) is a multicriteria tool considered to be relevant to nearly any ecosystem management application that requires the evaluation of multiple participants or complex decision-making processes are involved (Schmoldt & Peterson 1997, Schmoldt et al. 2001, Reynolds & Hessburg 2005).

    A need to consult an example of a form used to be filled by experts in a given area of knowledge in order to perform a pairwise comparison between environmental criteria that are useful to define the soil suitability of a region (e.g., soils, slope, aspect, clima,...). Two factors are compared using the rating scale which ranges from 1 to 9 with respect to their relative importance. Than we obtain the weights for each criteria that will be used in the map algebra.

    Devendra Swami

    How to generate questionnaire from dot ahp file using expert choice software to word??

  • Sanjay Kumar added an answer:
    Is the AHP a linear or a nonlinear method?
    The Saaty rating scale is rather nonlinear, but aggregation approach is definitely linear. Is the AHP a linear or a nonlinear method? I think it is a linear method (e.g. Zarghami and Szidarovszky).
    Zarghami M. and Szidarovszky F. (2011). Multicriteria Analysis, Springer, pp. 33-39.
    Sanjay Kumar

    I also agree that It is nonlinear.

  • Ransalu Senanayake added an answer:
    Can anyone recommend some good references in Bayesian analysis and decision making?

    I am looking for some top and mathematical references in Bayesian analysis and Bayesian decision making. Books and Tutorial articles mostly. Thank you

    Ransalu Senanayake

    The following are more Bayesian-biased.

    Machine Learning by Kevin Murphy

    Pattern Analysis and Machine Learning by Christoper Bishop

  • Sarfaraz Hashemkhani Zolfani added an answer:
    What is the reliability of TOPSIS technique?

    I have used AHP, TOPSIS and Fuzzy TOPSIS in my research work. I would like to know the reliability of TOPSIS and its variations.

    Sarfaraz Hashemkhani Zolfani

    There are many methods but in Opricovic and Tzeng in 2004 you can see VIKOR is a better method for ranking instead of TOPSIS. You may prefer read and learn other new methods like: SWARA (2010), COPRAS (1996), ARAS (2010), WASPAS (2012), BWM (2015) etc. 

  • Senthil Kumar d added an answer:
    Is there a difference between multi-criteria decision making (MCDM) and multi-attribute decision making (MADM)?
    Are MCDM and MADM synonyms? What are the differences?
    Senthil Kumar d

    multi attribute decision making is differs from multi objective decision making, because in data mining attribute selection is one of the objective. That is based on different objective we have to take final decision in data mining.

  • Marion G Ceruti added an answer:
    How can one factor irrationality in decision theory ?

    In hypothesis testing we use linear parameters. I am trying to work on factoring irrationality by using non linear modeling. I would like to factor the effect of correlation of the cause  variable in the result.

    Is this possible ? Is there any papers on this ? 

    Marion G Ceruti

    Probabilities for predicting markets are difficult for an ordinary individual to know. Too many variables influence markets, including manipulation.

    In decision making, rationality is subjective to a certain extent. If we have a set of decision criteria, a decision within that framework may appear to others as irrational if they are operating with different criteria. Examples can come from risk/reward scenarios.

    Consider the following problem. Two drugs are used to treat intense pain. One drug has a high probability of providing a moderate decrease in pain, which still leaves some residual pain that interferes with normal abilities. No one dies from using it. A second drug provides a dramatic reduction in pain to almost normal (zero) levels but proves fatal to 1% of the population that uses it. Which drug choice constitutes the rational decision? It depends on your decision criteria. Whereas it is true that one cannot predict exact individual outcome from analyzing data obtained in past studies, one can use published probabilities if they exist. Suppose you want to maximize the probability of living and are willing to live in a debilitated state. If this is the most important decision criterion, select drug A. If, however, you would not like to live in such a condition and would rather try for a better life, and this is the most important criterion, select drug B. Each of the decisions appears to be irrational when applying the opposite criterion. However, the decisions are rational given the criteria used.

    To consider another example, what constitutes a rational decision can depend on habits and experience. A decision about what to do in an emergency situation may seem rational to a novice who may be more likely to be influenced by emotions. However, to a person with more expertise, the same decision may appear to be irrational because the expert has more knowledge and experience and is aware of more options.

    Hope this helps.

  • Raivis Skadiņš added an answer:
    How can I induct a decision tree from text data ?

    Hello, I have a large corpus of product reviews given by customers, especially on mobile phones. I have done a topic modeling on this data so that the topics are extracted. I need to get aspects such as Camera, Sound, Price etc from this data. Can I use decision tree induction to classify the topics into aspects ? Is there any tools available for the same or do I need to classify manually ? Please help in this regard.

    Raivis Skadiņš

    Hi, this looks like normal machine learning issue.

    You need to define features which are somehow related to your aspects. Features can be something like - "how many times word CAMERA is nentined in the article" etc.. Then you label training data set with both features and aspects. Then you can build decision tree classifier which assignes aspect depending on features. You can use or other tool.

    Finally you can classify new data.

  • Sergey V. Popov added an answer:
    What are the common group tasks that people use in experiments?

    Does anyone know what are the common group tasks that people use in their experiments? Tasks where performance can be easily evaluated objectively? I found in literature Michigan State University Distributed Dynamic Decision Making (MSU-DDD), but could not find the modified version for research. Does anyone have this game or know other games that I can use in research? Thanks!

    Sergey V. Popov

    I was thinking about doing an experiment in teamwork efficiency, and the only thing that came to my mind is jigsaw puzzle solving: how much faster would a team of 2 solve the given 300-piece puzzle against team of 3, or something. You need something that is easy to parallelize, but that would require some interaction. My suspicion is that the good teamwork games would also be the games where individual effort is hard to quantify...

  • Carlos R. B. Azevedo added an answer:
    Are the decision-theoretic accounts of Preference for Flexibility and Freedom of Choice being applied outside economics?
    The first axiomatic accounts of preference for flexibility and freedom of choice are due to Koopmans (1962) and Kreps (1979), who assumed that a Decision Maker always enjoys having more alternatives available. After that, e.g. Puppe (1996) refined the idea and distinguished the essential alternatives in an opportunity set as those whose exclusion “would reduce an agent’s freedom”.

    Most applications I know of consider social choice problems that are relevant to economics theory. What other fields have seen applications of those concepts? I'm particularly interested in corporate decision-making and engineering design.


    T. C. Koopmans, “On flexibility of future preference,” Cowles Foundation for Research in Economics, Yale University, Cowles Foundation Discussion Papers 150, 1962.

    D. M. Kreps, “A representation theorem for ”preference for flexibility”,”
    Econometrica, vol. 47, no. 3, pp. pp. 565–577, 1979

    C. Puppe, “An Axiomatic Approach to 'Preference for Freedom
    of Choice'” Journal of Economic Theory, vol. 68, no. 1, pp. 174–
    199, January 1996
    Carlos R. B. Azevedo

    @Alejandro, those are great examples. Thanks.

  • Harald C Traue added an answer:
    How were ethically relevant cognitive biases within the test population controlled?

    The test population was self-selected from a sub-population (the Amazon Mechanical Turk subscriber base) which is significantly unrepresentative of the US population generally (which is itself highly heterogeneous). According to Wikipedia(for what it's worth) "Overall, the US MTurk population is mostly female and white, and is somewhat younger and more educated than the US population overall." Your test populations were, however, generally less than 50% female (just over that in study 2) and there were some significant screening tests applied, including such things as attentional deficits, rapid test completion and so on, which excluded high proportions of respondents (up to around 25% in study 3). I may be mistaken but I didn't notice any discussion of measures to control for culturally/socially/educationally normative cognitive biases that may skew the responses of such selectively filtered sub-populations compared to a more representative sample?

    In addition, while I can understand the purpose of the screening was probably  to facilitate selection of a test population of intentional responders, rapid response may not be negatively correlated with intentionality. It may reflect a previously well-considered ethical framework, or a cognitive bias derived from religious or other convictions, and there are other possibilities.

    Two other factors I would have thought may have been considered significant, especially in light of the work of Kohlberg and latterly Gilligan, are age and gender. Was any consideration given to these factors?

    (Edited to improve readability).

    • Source
      [Show abstract] [Hide abstract]
      ABSTRACT: A growing body of research has focused on so-called 'utilitarian' judgments in moral dilemmas in which participants have to choose whether to sacrifice one person in order to save the lives of a greater number. However, the relation between such 'utilitarian' judgments and genuine utilitarian impartial concern for the greater good remains unclear. Across four studies, we investigated the relationship between 'utilitarian' judgment in such sacrificial dilemmas and a range of traits, attitudes, judgments and behaviors that either reflect or reject an impartial concern for the greater good of all. In Study 1, we found that rates of 'utilitarian' judgment were associated with a broadly immoral outlook concerning clear ethical transgressions in a business context, as well as with sub-clinical psychopathy. In Study 2, we found that 'utilitarian' judgment was associated with greater endorsement of rational egoism, less donation of money to a charity, and less identification with the whole of humanity, a core feature of classical utilitarianism. In Studies 3 and 4, we found no association between 'utilitarian' judgments in sacrificial dilemmas and characteristic utilitarian judgments relating to assistance to distant people in need, self-sacrifice and impartiality, even when the utilitarian justification for these judgments was made explicit and unequivocal. This lack of association remained even when we controlled for the antisocial element in 'utilitarian' judgment. Taken together, these results suggest that there is very little relation between sacrificial judgments in the hypothetical dilemmas that dominate current research, and a genuine utilitarian approach to ethics.
      Cognition 01/2015; 134:193-209.
  • Alan Hawk added an answer:
    Does a formal definition for "Freedom of action" exist?

    The reason for my question is that so many other terms in the defence refer to the "Freedom of Action". [Please see for example: ADP 3–0, Unified Land Operations]

    Alan Hawk

    Try the DOD Dictionary at url

    Try The Joint Electronic Library at url

    JP 3-0 Joint Operations (11 Aug 2011) at url describes Freedom of Action as:.

    "The JFC must maintain freedom of action throughout the operation. Of necessity, freedom of action must extend beyond the JFC’s operational area. For example, operational reach—the distance and duration across which a joint force can successfully employ military capabilities—can extend far beyond the limits of a JFC’s JOA and is inextricably tied to lines of operation (LOOs). So the joint force must protect LOOs to ensure freedom of action. Likewise, the C2 and intelligence functions depend on operations within cyberspace. Losing the capability to operate effectively in cyberspace can greatly diminish the JFC’s freedom of action. While various actions (such as computer network defense [CND] and the consideration of branches to current operations) contribute individually to freedom of action, operational design and joint operation planning are the processes that coherently link these actions. Thus the JFC and staff must consider freedom of action from the outset of operational design and must be alert to indicators during operations that freedom of action is in jeopardy."

  • Gan Huang added an answer:
    Trust model based on Bayes Estimation using Matlab codes?

    I am researching the trust model in WSNs and doing the emulation for the model.I can't find some matlab codes about the reputation-based framework for sensor networks(RFSN).It uses  a Bayesian formulation and a beta contribution.Could you help me?

    Gan Huang

    Excuse me,sir.Could you say clearly?I don't understand.

  • Ehsan Chitsaz added an answer:
    Can anyone recommend a behavioral test or questionnaire to determine the pessimistic trait effects on cognitive bias like overestimation?

    I am planning to conduct research on competitive traits and its effect on competitive states. I would appreciate if someone could recommend me some instrument to evaluate pessimistic trait and cognitive bias consequences. Thank you in advance

    Ehsan Chitsaz


    Thanks for your answer, Could you please share with me the English version of your questionnaire in overconfidence bias? 

    About Wiklund et al(2010), I think you have uploaded a wrong file. Could you please send the file that mentioned in your answer.

    Unfortunately, China don't have a same database to exchange. But for next research we can consider about collecting data on that topic in China. At the moment,my research is about the threat in shadow and its consequences on innovation and firm performance.  

  • Danilo Rastovic added an answer:
    What are some good function approximation methods using fuzzy sets and logic such as fuzzy expert systems, fuzzy SVR, etc.?
    I have a project on function approximation by fuzzy decision trees and I want to compare my results with some other methods improved by fuzzy logic.
    Danilo Rastovic

    It will be good use the notice that the maximum of entropy product is equivalent to maximum entropy principle because of the properties of ln functions.

  • Henrique Rego Monteiro da Hora added an answer:
    Do you know any free softwares for Electre Family methods?
    Please let me know of all free softwares you know about Electre methods.
    Henrique Rego Monteiro da Hora

    These methods can be implemented in an excel sheet. Maybe you can find at google "electre filetype:xls" "electre filetype:xlsx" or "electre filetype:ods"

  • Jerald Feinstein added an answer:
    How do you assess a value function based on a set of features (attributes, criteria) which are preference-dependent?
    One of the tenets of multiattribute value theory is that each attribute (criterion) must be preferencial independent from each other. There are however specific cases where this assumption do not hold. In these cases, one can proceed by building a value function based on the set of attributes that are preference dependent. For instance, the visual quality of a forest depends on attributes as the size of the trees, the density of the forest stand, the diversity of species, and the diversity of distinct heights. There are preference dependencies among these attributes. How can I assess a value function for the objective "maximize the visual quality of a forest" based on these attributes?
    Jerald Feinstein
    You might want to look at the Analytic Hierarchy Process - - - a Google search will more than get you started. // jlf
  • Paul M.W. Hackett added an answer:
    Can anyone suggest reading material on case-based decision theory?
    Does anybody have any suggestions for what I should read about in connection with case-based decision theory? This is a totally new area to me and any information about the theory would be much appreciated.
    Paul M.W. Hackett
    Thanks Fabrizio.
  • Renato Cerceau added an answer:
    What MCDM methods can be used when the criteria are incomparable?
    I am looking for the methods like ELECTRE IV or MAXIMIN, and for papers where the problem of the criteriaincomparability is considered.
  • David John Butler added an answer:
    Are there prisoner's dilemma experiments which are truly one-shot?
    I'm looking for data from prisoner's dilemma experiments in which participants played only one round of the game. A closely related experiment, which I found, is Goeree, Holt and Laury (J Pub Econ 2002) where participants play ten one-shot games without feedback between games (hence, no learning effects).
    David John Butler

About Decision Theory

A theoretical technique utilizing a group of related constructs to describe or prescribe how individuals or groups of people choose a course of action when faced with several alternatives and a variable amount of knowledge about the determinants of the outcomes of those alternatives.

Topic followers (606) See all