Multiple criteria decision analysis: state of the art surveys
TL;DR: In this article, the authors present a survey of the state of the art in multiple criterion decision analysis (MCDA) with an overview of the early history and current state of MCDA.
Abstract: In two volumes, this new edition presents the state of the art in Multiple Criteria Decision Analysis (MCDA). Reflecting the explosive growth in the field seen during the last several years, the editors not only present surveys of the foundations of MCDA, but look as well at many new areas and new applications. Individual chapter authors are among the most prestigious names in MCDA research, and combined their chapters bring the field completely up to date. Part I of the book considers the history and current state of MCDA, with surveys that cover the early history of MCDA and an overview that discusses the “pre-theoretical” assumptions of MCDA. Part II then presents the foundations of MCDA, with individual chapters that provide a very exhaustive review of preference modeling, along with a chapter devoted to the axiomatic basis of the different models that multiple criteria preferences. Part III looks at outranking methods, with three chapters that consider the ELECTRE methods, PROMETHEE methods, and a look at the rich literature of other outranking methods. Part IV, on Multiattribute Utility and Value Theories (MAUT), presents chapters on the fundamentals of this approach, the very well known UTA methods, the Analytic Hierarchy Process (AHP) and its more recent extension, the Analytic Network Process (ANP), as well as a chapter on MACBETH (Measuring Attractiveness by a Categorical Based Evaluation Technique). Part V looks at Non-Classical MCDA Approaches, with chapters on risk and uncertainty in MCDA, the decision rule approach to MCDA, the fuzzy integral approach, the verbal decision methods, and a tentative assessment of the role of fuzzy sets in decision analysis. Part VI, on Multiobjective Optimization, contains chapters on recent developments of vector and set optimization, the state of the art in continuous multiobjective programming, multiobjective combinatorial optimization, fuzzy multicriteria optimization, a review of the field of goal programming, interactive methods for solving multiobjective optimization problems, and relationships between MCDA and evolutionary multiobjective optimization (EMO). Part VII, on Applications, selects some of the most significant areas, including contributions of MCDA in finance, energy planning problems, telecommunication network planning and design, sustainable development, and portfolio analysis. Finally, Part VIII, on MCDM software, presents well known MCDA software packages.
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TL;DR: The Analytic Hierarchy Process (AHP) is a theory of measurement through pairwise comparisons and relies on the judgements of experts to derive priority scales that measure intangibles in relative terms.
Abstract: Decisions involve many intangibles that need to be traded off To do that, they have to be measured along side tangibles whose measurements must also be evaluated as to, how well, they serve the objectives of the decision maker The Analytic Hierarchy Process (AHP) is a theory of measurement through pairwise comparisons and relies on the judgements of experts to derive priority scales It is these scales that measure intangibles in relative terms The comparisons are made using a scale of absolute judgements that represents, how much more, one element dominates another with respect to a given attribute The judgements may be inconsistent, and how to measure inconsistency and improve the judgements, when possible to obtain better consistency is a concern of the AHP The derived priority scales are synthesised by multiplying them by the priority of their parent nodes and adding for all such nodes An illustration is included
6,787 citations
TL;DR: In this paper, the authors present a handbook for constructing and using composite indicators for policy makers, academics, the media and other interested parties, which is concerned with those which compare and rank country performance in areas such as industrial competitiveness, sustainable development, globalisation and innovation.
Abstract: This Handbook aims to provide a guide for constructing and using composite indicators for policy makers, academics, the media and other interested parties. While there are several types of composite indicators, this Handbook is concerned with those which compare and rank country performance in areas such as industrial competitiveness, sustainable development, globalisation and innovation. The Handbook aims to contribute to a better understanding of the complexity of composite indicators and to an improvement of the techniques currently used to build them. In particular, it contains a set of technical guidelines that can help constructors of composite indicators to improve the quality of their outputs. It has been prepared jointly by the OECD (the Statistics Directorate and the Directorate for Science, Technology and Industry) and the Applied Statistics and Econometrics Unit of the Joint Research Centre of the European Commission in Ispra, Italy. Primary authors from the JRC are Michela Nardo, Michaela Saisana, Andrea Saltelli and Stefano Tarantola. Primary authors from the OECD are Anders Hoffmann and Enrico Giovannini. Editorial assistance was provided by Candice Stevens, Gunseli Baygan and Karsten Olsen. The research is partly funded by the European Commission, Research Directorate, under the project KEI (Knowledge Economy Indicators), Contract FP6 No. 502529. In the OECD context, the work has benefitted from a grant from the Danish government. The views expressed are those of the authors and should not be regarded as stating an official position of either the European Commission or the OECD.
2,892 citations
TL;DR: A state-of-the-art literature survey is conducted to taxonomize the research on TOPSIS applications and methodologies and suggests a framework for future attempts in this area for academic researchers and practitioners.
Abstract: Multi-Criteria Decision Aid (MCDA) or Multi-Criteria Decision Making (MCDM) methods have received much attention from researchers and practitioners in evaluating, assessing and ranking alternatives across diverse industries. Among numerous MCDA/MCDM methods developed to solve real-world decision problems, the Technique for Order Preference by Similarity to Ideal Solution (TOPSIS) continues to work satisfactorily across different application areas. In this paper, we conduct a state-of-the-art literature survey to taxonomize the research on TOPSIS applications and methodologies. The classification scheme for this review contains 266 scholarly papers from 103 journals since the year 2000, separated into nine application areas: (1) Supply Chain Management and Logistics, (2) Design, Engineering and Manufacturing Systems, (3) Business and Marketing Management, (4) Health, Safety and Environment Management, (5) Human Resources Management, (6) Energy Management, (7) Chemical Engineering, (8) Water Resources Management and (9) Other topics. Scholarly papers in the TOPSIS discipline are further interpreted based on (1) publication year, (2) publication journal, (3) authors' nationality and (4) other methods combined or compared with TOPSIS. We end our review paper with recommendations for future research in TOPSIS decision-making that is both forward-looking and practically oriented. This paper provides useful insights into the TOPSIS method and suggests a framework for future attempts in this area for academic researchers and practitioners.
1,571 citations
Cites background from "Multiple criteria decision analysis..."
...A http://dx.doi.org/10.1016/j.eswa.2012.05.056 ⇑ Corresponding author....
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...Since the 1960s, MCDA/MCDM has been an active research area and produced many theoretical and applied papers and books (Roy, 2005)....
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TL;DR: A novel version of the method (augmented @e-constraint method - AUGMECON) is proposed that avoids the production of weakly Pareto optimal solutions and accelerates the whole process by avoiding redundant iterations.
1,354 citations
01 Jan 1994
TL;DR: In this Chapter, a decision maker (or a group of experts) trying to establish or examine fair procedures to combine opinions about alternatives related to different points of view is imagined.
Abstract: In this Chapter, we imagine a decision maker (or a group of experts) trying to establish or examine fair procedures to combine opinions about alternatives related to different points of view.
1,329 citations
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TL;DR: In this article, the authors show that the maximization of individual wealth is not an ordinary problem in variational calculus, because the individual does not control, and may even be ignorant of, some of the variables.
Abstract: THIS book is based on the theory that the economic man attempts to maximize his share of the world's goods and services in the same way that a participant in a game involving many players attempts to maximize his winnings. The authors point out that the maximization of individual wealth is not an ordinary problem in variational calculus, because the individual does not control, and may even be ignorant of, some of the variables. The general theory of social games, in their view, offers a simplified conceptual model of economic behaviour, and a study of that theory can do much to throw light on certain basic concepts of economics, for example, that of utility. Theory of Games and Economic Behavior By John Von Neumann Oskar Morgenstern. Pp. xviii + 625. (Princetown, N.J.: Princetown University Press; London: Sir Humphrey Milford, Oxford University Press, 1944.) 66s. 6d.
5,824 citations
"Multiple criteria decision analysis..." refers background in this paper
...Félix Edouard Justin Emile Borel (1871-1956) and John von Neumann (1903-1957) are considered the founders of game theory [5, 6, 20, 19]....
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Book•
01 Aug 1989
TL;DR: Mathematical Background Topics from Linear Algebra Single Objective Linear Programming Determining all Alternative Optima Comments about Objective Row Parametric Programming Utility Functions, Nondominated Criterion Vectors and Efficient Points Point Estimate Weighted-sums Approach.
Abstract: Mathematical Background Topics from Linear Algebra Single Objective Linear Programming Determining all Alternative Optima Comments about Objective Row Parametric Programming Utility Functions, Nondominated Criterion Vectors and Efficient Points Point Estimate Weighted-sums Approach Optimal Weighting Vectors, Scaling and Reduced Feasible Region Methods Vector-Maximum Algorithms Goal Programming Filtering and Set Discretization Multiple Objective Linear Fractional Programming Interactive Procedures Interactive Weighted Tchebycheff Procedure Tchebycheff/Weighted-Sums Implementation Applications Future Directions Index.
3,280 citations
2,186 citations
"Multiple criteria decision analysis..." refers background in this paper
...Félix Edouard Justin Emile Borel (1871-1956) and John von Neumann (1903-1957) are considered the founders of game theory [5, 6, 20, 19]....
[...]
Book•
04 Mar 2009
TL;DR: Condorcet's paradox (the non-transitivity of majority preferences) is seen as the direct ancestor of Arrow's paradox as discussed by the authors, and it was rediscovered as a foundational work in the theory of voting and societal preferences.
Abstract: A central figure in the early years of the French Revolution, Nicolas de Condorcet (1743–94) was active as a mathematician, philosopher, politician and economist. He argued for the values of the Enlightenment, from religious toleration to the abolition of slavery, believing that society could be improved by the application of rational thought. In this essay, first published in 1785, Condorcet analyses mathematically the process of making majority decisions, and seeks methods to improve the likelihood of their success. The work was largely forgotten in the nineteenth century, while those who did comment on it tended to find the arguments obscure. In the second half of the twentieth century, however, it was rediscovered as a foundational work in the theory of voting and societal preferences. Condorcet presents several significant results, among which Condorcet's paradox (the non-transitivity of majority preferences) is now seen as the direct ancestor of Arrow's paradox.
1,782 citations