Multicriteria Decision Making

Abstract

This chapter analyzes a variety of approaches dealing with decision-making in the presence of multiple criteria. Work in the field is based on early studies by Simon (1982), Keeney and Raiffa (1976), and the psychological investigations by Kahneman and Tversky (1979). Zimmermann (1991) points out that multicriteria decision making, or MCDM for short, can be subdivided into two subsets. They are multiobjective decision making, or MODM, and multiattribute decision making, or MADM. The difference is that in multiobjective models, variables tend to be continuous, while multi-attribute decision-making problems are typically discrete problems that choose one out of a given number of options. Many, if not most, authors, however, employ the term multicriteria decision-making in the narrow sense to refer to a multiattribute decision making problem. Given the diversity of the strands of research, it is perhaps not surprising that each approach has its proponents, who work in their own area and hardly ever venture outside. There are, however, some notable exceptions, such as the recent books by Hanne (2001), Belton and Stewart (2002), and Ehrgott and Gandibleux (2002) who attempt to integrate the field.