Investigating Two-Attribute Utility Function Regarding “No Independence Properties Hold”

Authors

  • Bohlol Ebrahimi * Department of Industrial Engineering & Management Systems, Amirkabir University of Technology (Tehran Polytechnic), 424 Hafez Ave., Tehran 15916-34311, Iran.
  • Majid Aminnayeri Department of Industrial Engineering & Management Systems, Amirkabir University of Technology (Tehran Polytechnic), 424 Hafez Ave., Tehran 15916-34311, Iran.
  • Reza Ramazani Department of Industrial Engineering & Management Systems, Amirkabir University of Technology (Tehran Polytechnic), 424 Hafez Ave., Tehran 15916-34311, Iran.

https://doi.org/10.48314/ramd.v1i2.54

Abstract

In two-attribute statistical decision-making problems, two-attribute utility function is needed to be calculated for making the best decision. In the presence of any independence between the attributes, additive independence or mutual utility independence and so on, the calculation of two-attribute utility function is easy. But when no independence properties hold between the attributes, the calculation of twoattribute utility function will be difficult. In this paper two-attribute utility function is studied. There would be three main methods to calculate the two-attribute utility function regarding "no independence properties hold". These methods are: transformation of Attributes, Direct Assessment and Employment Utility Independent over Subsets of Consequences Space. These methods discussed completely with their deficiencies. Also we propose whitening technique to improve the transformation of attributes method.

Keywords:

Statistical decision, Two-attribute utility function, Utility independence, Whitening technique

References

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Published

2024-12-27

Issue

Vol. 1 No. 2 (2024): Risk Assessment and Management Decisions (RAMD)

Section

Articles

How to Cite

Ebrahimi, B. ., Aminnayeri, M. ., & Ramazani, R. . (2024). Investigating Two-Attribute Utility Function Regarding “No Independence Properties Hold”. Risk Assessment and Management Decisions, 1(2), 314-321. https://doi.org/10.48314/ramd.v1i2.54

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