MCDM'05 - paper no. 11


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An interactive procedure for project selection

Maciej Nowak


The evaluation of each project usually involves multiple objectives, including economic desirability, technical novelty, social impact, ecological consequences and others. While financial criteria are usually of quantitative nature, other are often qualitative. In the paper An Interactive Procedure for Project Selection (M. Nowak) a new procedure for this problem is propose. The methods uses simulation technique for economic desirability evaluation and takes into account experts' assessments in relation to qualitative criteria. Thus, project selection can be analyzed as a multiple criteria decision making problem in which outcomes of projects are evaluated by vectors of probability distributions. In the paper an interactive technique is employed for solving this problem. The method combines two basic approaches usually used for comparing uncertain projects: mean-risk analysis and stochastic dominance. The decision maker expresses his/her preferences by defining restrictions specifying minimal or maximal values of scalar criteria measuring either expected outcome or variability of outcomes. As such restriction are, in general, not consistent with stochastic dominance rules, a procedure for identifying and eliminating such inconsistencies is described.

Reference index:

Maciej Nowak, (2006), An interactive procedure for project selection, Multiple Criteria Decision Making (1), pp. 165-184

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