Decision Making Under Model Uncertainty: Fréchet–Wasserstein Mean Preferences

2021 ◽  
Author(s):  
Electra V. Petracou ◽  
Anastasios Xepapadeas ◽  
Athanasios N. Yannacopoulos
Keyword(s):  
Decision Making ◽  
Model Uncertainty ◽  
Ambiguity Aversion ◽  
Decision Makers ◽  
Social Discount Rate ◽  
Wasserstein Metric ◽  
Probability Models ◽  
The Social ◽  
The Given ◽  
Variational Preferences

This paper contributes to the literature on decision making under multiple probability models by studying a class of variational preferences. These preferences are defined in terms of Fréchet mean utility functionals, which are based on the Wasserstein metric in the space of probability models. In order to produce a measure that is the “closest” to all probability models in the given set, we find the barycenter of the set. We derive explicit expressions for the Fréchet–Wasserstein mean utility functionals and show that they can be expressed in terms of an expansion that provides a tractable link between risk aversion and ambiguity aversion. The proposed utility functionals are illustrated in terms of two applications. The first application allows us to define the social discount rate under model uncertainty. In the second application, the functionals are used in risk securitization. The barycenter in this case can be interpreted as the model that maximizes the probability that different decision makers will agree on, which could be useful for designing and pricing a catastrophe bond. This paper was accepted by Manel Baucells, decision analysis.

scholarly journals Do Women Affect the Final Decision on the Housing Market? A Case Study

2020 ◽  
Vol 12 (11) ◽  
pp. 4652
Author(s):  
Sabina Źróbek ◽  
Elżbieta Zysk ◽  
Mirosław Bełej ◽  
Natalija Lepkova
Keyword(s):  
Decision Making ◽  
Housing Market ◽  
Final Decision ◽  
Territorial Unit ◽  
The Social ◽  
Joint Decisions ◽  
Gradual Introduction ◽  
Decision Making Model ◽  
The Given

This article presents the results of research on the effect of the customer’s gender on the tenure choice (ownership or tenancy) on the housing market. In the study, an attempt has been made to investigate whether there is a significant role of women in making decisions in this market. The survey was conducted among residents of two cities—Olsztyn (Poland) and Vilnius (Lithuania). The obtained answers were subjected to a multi-dimensional categorical and quantitative analysis. The results showed, among others, that women generally have greater decision-making autonomy in residential issues than men, with Lithuanian women doing this much more often than Polish women. However, it should be noted that the dominant decision-making model in the housing market is the model of joint decisions taken by men and women. The results of the conducted analysis broaden the existing knowledge of the functioning of the housing market and may support the implementation of the pro-social and pro-sustainable spatial development policy of the given territorial unit. The results may also contribute to more sustainable development of enterprises in the housing construction sector. This is an important issue in a climate of intense competition between “providers” of flats and the gradual introduction of the idea of competition between them and the social environment.

scholarly journals Encouraging Decision Vigilance Through Increased Accountability

2011 ◽  
Vol 9 (3) ◽  
pp. 129 ◽  
Author(s):  
Patricia M. Fandt
Keyword(s):  
Decision Making ◽  
Customer Service ◽  
Decision Makers ◽  
Organizational Setting ◽  
Course Of Action ◽  
Two Measures ◽  
Customer Service Representatives ◽  
Quality Decision ◽  
The Given

The study examines how vigilance in decision making is affected by accountability. As suggested by Janis and Mann (1977), high quality decision making is characterized by the presence of vigilance. By examining the procedures used by decision makers in selecting a course of action, it is possible to predict the quality of the given decision or course of action. In an organizational setting, 140 customer service representatives were exposed to a realistic job related decision making exercise. Using two measures of decision vigilance strategy, results indicate that decision makers in high accountability conditions use more decision vigilance than decision makers in low accountability conditions. Implications for practicing managers are suggested.

scholarly journals Social framing effects in decision making

2021 ◽  
Author(s):  
Payam Piray ◽  
Roshan Cools ◽  
Ivan Toni
Keyword(s):  
Decision Making ◽  
Prefrontal Cortex ◽  
Framing Effect ◽  
Ventromedial Prefrontal Cortex ◽  
Neural Mechanisms ◽  
Decision Makers ◽  
The Social ◽  
Personal Experiences ◽  
Human Participants ◽  
Individual Value

Human decisions are known to be strongly influenced by the manner in which options are presented, the "framing effect". Here, we ask whether decision-makers are also influenced by how advice from other knowledgeable agents are framed, a "social framing effect". Concretely, do students learn better from a teacher who often frames advice by emphasizing appetitive outcomes, or do they learn better from another teacher who usually emphasizes avoiding options that can be harmful to their progress? We study the computational and neural mechanisms by which framing of advice affect decision-making, social learning, and trust. We found that human participants are more likely to trust and follow an adviser who often uses an appetitive frame for advice compared with another one who often uses an aversive frame. This social framing effect is implemented through a modulation of the integrative abilities of the ventromedial prefrontal cortex. At the time of choice, this region combines information learned via personal experiences of reward with social information, but the combination differs depending on the social framing of advice. Personally-acquired information is weighted more strongly when dealing with an adviser who uses an aversive frame. The findings suggest that social advice is systematically incorporated into our decisions, while being affected by biases similar to those influencing individual value-based learning.

scholarly journals Chimpanzees and bonobos distinguish between risk and ambiguity

2010 ◽  
Vol 7 (1) ◽  
pp. 15-18 ◽  
Author(s):  
Alexandra G. Rosati ◽  
Brian Hare
Keyword(s):  
Decision Making ◽  
Pan Troglodytes ◽  
Ambiguity Aversion ◽  
Pan Paniscus ◽  
Decision Makers ◽  
Food Type ◽  
Decision Making Under Risk ◽  
Choice Behaviour ◽  
The Impact ◽  
Risky Option

Although recent research has investigated animal decision-making under risk, little is known about how animals choose under conditions of ambiguity when they lack information about the available alternatives. Many models of choice behaviour assume that ambiguity does not impact decision-makers, but studies of humans suggest that people tend to be more averse to choosing ambiguous options than risky options with known probabilities. To illuminate the evolutionary roots of human economic behaviour, we examined whether our closest living relatives, chimpanzees ( Pan troglodytes ) and bonobos ( Pan paniscus ), share this bias against ambiguity. Apes chose between a certain option that reliably provided an intermediately preferred food type, and a variable option that could vary in the probability that it provided a highly preferred food type. To examine the impact of ambiguity on ape decision-making, we interspersed trials in which chimpanzees and bonobos had no knowledge about the probabilities. Both species avoided the ambiguous option compared with their choices for a risky option, indicating that ambiguity aversion is shared by humans, bonobos and chimpanzees.

scholarly journals Shared decision-making allows subordinates to lead when dominants monopolize resources

2020 ◽  
Vol 6 (48) ◽  
pp. eaba5881
Author(s):  
Danai Papageorgiou ◽  
Damien R. Farine
Keyword(s):  
Decision Making ◽  
Shared Decision Making ◽  
Dominance Hierarchy ◽  
Social Groups ◽  
Decision Makers ◽  
Shared Decision ◽  
Intragroup Conflict ◽  
The Social ◽  
Animal Societies

The concepts of leadership and dominance are often conflated, with individuals high in the social hierarchy assumed to be decision-makers. Dominants can exclusively benefit from monopolizing food resources and, therefore, induce an intragroup conflict when leading their group to these resources. We demonstrate that shared decision-making reduces such conflicts by studying movement initiations of wild vulturine guineafowl, a species that forms large, stable social groups with a steep dominance hierarchy. When dominant individuals displace subordinates from monopolizable food patches, the excluded subordinates subsequently initiate collective movement. The dominants then abandon the patch to follow the direction of subordinates, contrasting with nonmonopolizable resources where no individuals are excluded, and dominant individuals contribute extensively to group decisions. Our results demonstrate the role of shared decision-making in maintaining the balance of influence within animal societies.

scholarly journals Responsible Precautions for Uncertain Environmental Risks

2019 ◽  
Vol 10 (2) ◽  
pp. 296-315 ◽  
Author(s):  
W. Kip Viscusi ◽  
Joel Huber ◽  
Jason Bell
Keyword(s):  
Decision Making ◽  
Drinking Water ◽  
Bisphenol A ◽  
Prescription Drugs ◽  
Ambiguity Aversion ◽  
Environmental Risks ◽  
Decision Makers ◽  
Household Decision ◽  
Empirical Results ◽  
Uncertain Future

AbstractUncertain future risks pose cognitive and analytical challenges to household decision makers. Risks with uncertain probabilities, coupled with potentially severe outcomes pose problems for decision-making and are prone to overreactions. Imprecision in risk estimates generates behavioral distortions such as ambiguity aversion. This article presents new empirical results indicating household overvaluations of uncertain threats posed by several drinking water risks: traces of prescription drugs in drinking water, plastic water bottles with bisphenol-A, and the weed killer atrazine in drinking water. Negative reactions reflect responses to ambiguous risks, but policies driven by these concerns may misallocate regulatory resources due to risk conservatism and “no-regrets” responses.

scholarly journals Cubic q-Rung Orthopair Fuzzy Heronian Mean Operators and Their Applications to Multi-Attribute Group Decision Making

Mathematics ◽  
2020 ◽  
Vol 8 (7) ◽  
pp. 1125
Author(s):  
Baosheng Zhang ◽  
Tahir Mahmood ◽  
Jabbar Ahmmad ◽  
Qaisar Khan ◽  
Zeeshan Ali ◽  
...  
Keyword(s):  
Decision Making ◽  
Fuzzy Sets ◽  
Group Decision Making ◽  
Fuzzy Set ◽  
Group Decision ◽  
Decision Makers ◽  
The Given ◽  
Interval Valued ◽  
Heronian Mean ◽  
Selection Of

The cubic q-rung orthopair fuzzy set (Cq-ROFS) contains much more information to determine the interval valued q-rung orthopair fuzzy sets (IVq-ROFSs) and q-rung orthopair fuzzy sets (q-ROFSs) simultaneously for coping with the vagueness in information. It provides more space for decision makers (DMs) to describe their opinion in the environment of fuzzy set (FS) theory. In this paper, firstly, we introduce the conception of Cq-ROFS and their characteristics. Further, the Heronian mean (HM) operator based on Cq-ROFS, called the weighted HM operator, are explored. To overcome the deficiency of HM operator and keeping in mind the partitioned structure in real decision situations, we offer Cubic q-rung orthopair fuzzy partitioned HM operator and its weighted shape. An algorithm of the proposed operators based on multi-attribute group decision making (MAGDM) problems for the selection of best alternative among the given ones is established. Lastly, we provide an example to depict the authenticity and advantages of the exposed methods by contrasting with other existing drawbacks.

scholarly journals An Optimization-Based Approach to Social Network Group Decision Making with an Application to Earthquake Shelter-Site Selection

2019 ◽  
Vol 16 (15) ◽  
pp. 2740 ◽  
Author(s):  
Zhang ◽  
Wang ◽  
Tang ◽  
Dong
Keyword(s):  
Decision Making ◽  
Social Network ◽  
Group Decision Making ◽  
Social Trust ◽  
Group Decision ◽  
Preference Relation ◽  
Decision Makers ◽  
Preference Relations ◽  
Shelter Site ◽  
The Social

The social network has emerged as an essential component in group decision making (GDM) problems. Thus, this paper investigates the social network GDM (SNGDM) problem and assumes that decision makers offer their preferences utilizing additive preference relations (also called fuzzy preference relations). An optimization-based approach is devised to generate the weights of decision makers by combining two reliable resources: in-degree centrality indexes and consistency indexes. Based on the obtained weights of decision makers, the individual additive preference relations are aggregated into a collective additive preference relation. Further, the alternatives are ranked from best to worst according to the obtained collective additive preference relation. Moreover, earthquakes have occurred frequently around the world in recent years, causing great loss of life and property. Earthquake shelters offer safety, security, climate protection, and resistance to disease and ill health and are thus vital for disaster-affected people. Selection of a suitable site for locating shelters from potential alternatives is of critical importance, which can be seen as a GDM problem. When selecting a suitable earthquake shelter-site, the social trust relationships among disaster management experts should not be ignored. To this end, the proposed SNGDM model is applied to evaluate and select earthquake shelter-sites to show its effectiveness. In summary, this paper constructs a novel GDM framework by taking the social trust relationship into account, which can provide a scientific basis for public emergency management in the major disasters field.

Surrogate’s Personal Sense of Duty as a Crucial Element in Medical Decision Making

2021 ◽  
pp. 7-26
Author(s):  
Chris Feudtner ◽  
Theodore E. Schall ◽  
Douglas L. Hill
Keyword(s):  
Decision Making ◽  
Medical Decision Making ◽  
Adult Child ◽  
Decision Makers ◽  
Medical Decision ◽  
Single Event ◽  
Medical Decisions ◽  
The Social ◽  
Surrogate Decision Makers ◽  
Surrogate Decision

Surrogates who must make medical decisions for other people—most often, loved ones—face difficult challenges not acknowledged in current models of medical decision making. Furthermore, medical decisions are typically not a single event, but an ongoing event that evolves over time. This chapter presents a broader conceptualization of medical decision making, highlighting that (1) surrogate decision makers often face multiple problems, not a single clear problem; (2) the path to the decision maker’s desired goal is often unclear and often constrained by past decisions; (3) the social relationships between the surrogate and the patient (parent, adult child, spouse) influence the decision making as surrogates try to fulfill their role as a good parent, good son/daughter, or good spouse; and (4) surrogate decision makers often judge themselves negatively in ways that influence their decisions and the outcome. Clinicians who recognize these complex influences on surrogate decision making may be better able to support surrogates through this difficult process.

Analyzing Uncertainty in Cost-effectiveness For Decision-making

2011 ◽  
pp. 758-787 ◽  
Author(s):  
Susan Griffin ◽  
Karl Claxton
Keyword(s):  
Decision Making ◽  
Cost Effectiveness ◽  
Health Benefit ◽  
Decision Makers ◽  
Full Characterization ◽  
Health Gains ◽  
The Social ◽  
Primary Focus ◽  
The Cost ◽  
Social Decision Making

Cost-effectiveness analysis (CEA) is intended to help collective purchasers of health care to determine which interventions to prioritize, by ranking them according to the cost of each unit of “health benefit” they produce. The primary focus of this article is on the social decision-making approach where the decision-maker's objective is assumed to be the maximization of health gains subject to a given budget constraint. This article begins with the rationale for presenting a full characterization and analysis of uncertainty within any CEA. An overview of methods that can be used to conduct a CEA that accounts for uncertainty is provided, including the means to present and interpret the results. The benefits and limitations of the methods for analyzing uncertainty are considered in the context of providing information to decision-makers. The article concludes by discussing the additional questions that arise when the need for further research to support those decisions is considered.

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