Cumulative dominance in multi-attribute choice: benefits and limits
Cumulative dominance in multi-attribute choice: benefits and limits
Guided decision processes improve decisions by employing personalized rules that are simple and perform well. In multi-attribute choice, simple rules such as deterministic elimination by aspects can achieve maximum utility because they choose a cumulative-dominant alternative when one exists and because of the combination of two results: (i) a cumulative-dominant alternative has maximum utility when the utility function is linear and (ii) a cumulative-dominant alternative exists frequently in the majority of choice problems when the attributes are binary. We test the limits of (i) and (ii) by relaxing their assumptions about the utility function and the attributes: First, for a linear utility function that also includes multiplicative attribute interactions, we analytically show that a cumulative-dominant alternative has maximum utility when attributes are binary. Whereas this is not necessarily true for continuous attributes, we empirically find that it is essentially always true for a range of probability distributions of the attributes and parameterizations of the utility function. Second, we empirically find that when attributes are continuous, a cumulative-dominant alternative exists frequently only in the minority of choice problems. In sum, cumulative dominance legitimates guiding decision processes by simple rules when it exists but its existence should not be taken for granted.
Cumulative dominance, Decision analysis, Elimination by aspects, Guided decision processes, Multi-attribute choice, Simple heuristics
153-163
Katsikopoulos, Konstantinos V.
b97c23d9-8b24-4225-8da4-be7ac2a14fba
Egozcue, Martin
18d170ae-9a89-414c-974f-ba6e10471ea6
Garcia, Luis Fuentes
5d6e311f-d81a-4095-b83f-b8c184fefb2c
1 June 2014
Katsikopoulos, Konstantinos V.
b97c23d9-8b24-4225-8da4-be7ac2a14fba
Egozcue, Martin
18d170ae-9a89-414c-974f-ba6e10471ea6
Garcia, Luis Fuentes
5d6e311f-d81a-4095-b83f-b8c184fefb2c
Katsikopoulos, Konstantinos V., Egozcue, Martin and Garcia, Luis Fuentes
(2014)
Cumulative dominance in multi-attribute choice: benefits and limits.
EURO Journal on Decision Processes, 2 (1-2), .
(doi:10.1007/s40070-014-0026-9).
Abstract
Guided decision processes improve decisions by employing personalized rules that are simple and perform well. In multi-attribute choice, simple rules such as deterministic elimination by aspects can achieve maximum utility because they choose a cumulative-dominant alternative when one exists and because of the combination of two results: (i) a cumulative-dominant alternative has maximum utility when the utility function is linear and (ii) a cumulative-dominant alternative exists frequently in the majority of choice problems when the attributes are binary. We test the limits of (i) and (ii) by relaxing their assumptions about the utility function and the attributes: First, for a linear utility function that also includes multiplicative attribute interactions, we analytically show that a cumulative-dominant alternative has maximum utility when attributes are binary. Whereas this is not necessarily true for continuous attributes, we empirically find that it is essentially always true for a range of probability distributions of the attributes and parameterizations of the utility function. Second, we empirically find that when attributes are continuous, a cumulative-dominant alternative exists frequently only in the minority of choice problems. In sum, cumulative dominance legitimates guiding decision processes by simple rules when it exists but its existence should not be taken for granted.
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More information
Accepted/In Press date: 30 April 2014
e-pub ahead of print date: 27 May 2014
Published date: 1 June 2014
Keywords:
Cumulative dominance, Decision analysis, Elimination by aspects, Guided decision processes, Multi-attribute choice, Simple heuristics
Identifiers
Local EPrints ID: 438612
URI: http://eprints.soton.ac.uk/id/eprint/438612
ISSN: 2193-9438
PURE UUID: 50bc89de-ac1f-446d-9427-542433bfd3d8
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Date deposited: 18 Mar 2020 17:32
Last modified: 17 Mar 2024 03:44
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Author:
Martin Egozcue
Author:
Luis Fuentes Garcia
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