Some comments on Saaty's AHP
Article Abstract:
Saaty's analytic hierarchy process (AHP) method is re-evaluated to clarify some issues that have been raised regarding the suitability and correctness of the way it deals with criteria weights. Many criticisms have been leveled against this method since its introduction in 1982, one of which is its susceptibility to the Rank Reversal phenomenon. Critics say that this shortcoming is caused by the fact that the weight of each criterion is not linked to the evaluations of the available alternatives over this criterion. Several attempts have been made to disprove such criticisms, but no consensus has been reached. The present study tries to show that many issues regarding AHP have remained unresolved because the real situation in which the method is applied has not been considered. When the real situation is taken into account, it can be demonstrated that an aggregation method is not necessarily flawed just because it fails to satisfy a formal property.
Publication Name: Management Science
Subject: Business, general
ISSN: 0025-1909
Year: 1995
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The invention of the independence condition for preferences
Article Abstract:
Three central concepts in preference theory are analyzed. These are the independence condition in decision under risk, the sure-thing principle in decision under uncertainty, and conjoint independence for multiattribute decisions and consumer theory. The 'independence condition' calls for delineations in preferences across disjoint events. The sure-thing principle was introduced by L.J. Savage to incorporate independence to decision under uncertainty. This principle holds that a choice between two risks has no relation to the states in which the two generate the same outcomes. Conjoint independence for consumer theory is a concept introduced by Sono and Samuelson which extends the idea of independence into consumer preferences. The sure-thing principle and conjoint independence are mathematically equivalent, while independence and the sure-thing principle are equivalent for decision under risk.
Publication Name: Management Science
Subject: Business, general
ISSN: 0025-1909
Year: 1995
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Individual hybrid models for conjoint analysis
Article Abstract:
A description and comparisons of four hybrid models for conjoint analysis in terms of their performance in an industry-based study entailing 15 product attributes are presented. The comparisons are conducted based on internal cross-validation, market share estimates, attribute importances clustering and its relationship to exogenous background variables. Comparisons of the proposed hybrid models to selected models from the transportation science literature are also presented. Three of the four hybrid models fit all parameters at the individual level. Only the convex combination model utilizes group-level parameters. It should be stressed that comparative model performance may depend strongly on the applications of the different models.
Publication Name: Management Science
Subject: Business, general
ISSN: 0025-1909
Year: 1996
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