A Decision-Making Framework Based on the Prospect Theory Under an Intuitionistic Fuzzy Environment

Abstract

Uncertainty and ambiguity are frequently involved in the decision-making process in our daily life. This paper develops a generalized decision-making framework based on the prospect theory under an intuitionistic fuzzy environment, by closely integrating the prospect theory and the intuitionistic fuzzy sets into our framework. We demonstrate how to compute the intuitionistic fuzzy prospect values as the reference values for decision-making and elaborate a four-step editing phase and a valuation phase with two key functions: the value function and the weighting function. We then conduct experiments to test our decision- making methodology and the key features of our framework. The experimental results show that the shapes of the value function and the weighting function in our framework are in line with those of prospect theory. The methodology proposed in this paper to elicit prospects that are not only under uncertainty but also under ambiguity. We reveal the decision-making behavior pattern through comparing the parameters. People are less risk averse when making decisions under an intuitionistic fuzzy environment than under uncertainty. People still underestimate the probability of the events in our experiment. Further, the choices of participants in the experiments are consistent with the addition and multiplication principles of our framework.

Grey relational analysis method for typhoon vulnerability assessment of civil engineering structures based on the 2-tuple linguistic neutrosophic number

“…Khaleie and Fasanghari [ 19 ] used intuitionistic fuzzy entropy to comprehensively consider subjective and objective factors and calculate the weight of experts. Gu et al [ 20 ] proposed an intuitionistic fuzzy MADM scheme optimization method based on correlated information and prospect theory. Pei et al [ 21 ] studied the group decision-making problem with low consensus characteristics based on the intuitionistic fuzzy theory.…”

[Retracted] A Decision‐Making Framework for University Student Sports Study Psychological Healthy Evaluation with 2‐Tuple Linguistic Neutrosophic Numbers

“…Khaleie and Fasanghari [43] used intuitionistic fuzzy entropy to comprehensively consider subjective and objective factors and calculate the weight of experts and introduced an evidence reasoning method to deal with the information with zero membership degree of evaluation value and carried out a fuzzy information fusion method. Gu et al [44] improved the MADM theory and method under expected utility theory from the perspective of prospect theory and proposed an intuitionistic fuzzy MADM scheme optimization method based on correlated information and prospect theory and introduced prospect theory to construct a group clustering method. Mishra et al [45] focused their research on this application area, constructing a composite APPROACH of SWAA and COPRAS in an intuitively ambiguous environment to address the best decisions for bioenergy production technologies.…”

Transdisciplinary Scientific Strategies for Soft Computing Development: Towards an Era of Data and Business Analytics

“…Some experiments testing the compatibility of CFL with human behavior were made, like a fuzzy way to understand experiments of Kahneman and Tversky [124,125] and a study of the best fuzzy operators in the framework of constructive decision-making ap-…”

“…Some experiments testing the compatibility of CFL with human behavior were made, like a fuzzy way to understand experiments of Kahneman and Tversky [124,125] and a study of the best fuzzy operators in the framework of constructive decision-making approach [126] Experiments for testing the compatibility of CFL with problems of data mining, like the discovery of association and classification rules [9,10,127], have been made successfully.…”