Foundations of Multiattribute Utility
Cambridge University Press, 6/28/2018
EAN 9781107150904, ISBN10: 1107150906
Hardcover, 480 pages, 25.9 x 18.5 x 3.6 cm
Language: English
Many of the complex problems faced by decision makers involve uncertainty as well as multiple conflicting objectives. This book provides a complete understanding of the types of objective functions that should be used in multiattribute decision making. By using tools such as preference, value, and utility functions, readers will learn state-of-the-art methods to analyze prospects to guide decision making and will develop a process that guarantees a defensible analysis to rationalize choices. Summarizing and distilling classical techniques and providing extensive coverage of recent advances in the field, the author offers practical guidance on how to make good decisions in the face of uncertainty. This text will appeal to graduate students and practitioners alike in systems engineering, operations research, business, management, government, climate change, energy, and healthcare.
Part I. Foundations of Preference, Value, and Utility
1. Preference, value, and utility
2. Foundations of expected utility
3. Some flawed methods of decision making
Part II. Deterministic Decisions
4. The order rule
preferences for deterministic consequences
5. Getting the attributes right
6. Preference functions for single attributes
7. Preference functions for multiple attributes
8. Additive preference functions
9. Valuing deterministic consequences – value functions
Part III. Decisions with Uncertainty
Multi-attribute Utility Functions Using a Value Measure
10. Single-attribute utility function
11. Multi-attribute utility functions using preference and value functions
12. Utility functions over additive preference or value functions
Part IV. Decisions with Uncertainty
Properties of Single-Attribute Utility Functions
13. The role of the utility function in valuing uncertain deals
14. The risk aversion function
15. Scale transformations applied to lottery outcomes
16. The invariant transformation of a utility function
17. Valuing changes in investment opportunities
18. One-switch utility functions
19. Utility transversality
20. Multi-attribute risk aversion
Part V. Decisions with Uncertainty
Multi-attribute Utility Functions without Preference or Value Functions
21. Attribute dominance utility
22. The two-attribute utility tree
23. Independence conditions for two attributes
24. The multi-attribute utility tree
25. Independence conditions for three or more attributes
26. Higher-order independence conditions
27. One-switch utility independence
Part VI. Utility Copula Formulations
28. Multi-attribute utility copulas
29. Archimedean utility copulas
30. Assessing Archimedean utility copulas
31. Utility copula functions matching all boundary assessments
32. Bidirectional one-switch ordinal copulas
33. Reflections of what we have learned.