The ethical matrix is a participatory tool designed to structure ethical reflection about the design, the introduction, the development or the use of technologies. Its collective implementation, in the context of participatory decision-making, has shown its potential usefulness. On the contrary, its implementation by a single researcher has not been thoroughly analyzed. The aim of this paper is precisely to assess the strength of ethical matrixes implemented by a single researcher as a tool for conceptual normative analysis related to technological (...) choices. Therefore, the ethical matrix framework is applied to the management of high-level radioactive waste, more specifically to retrievable and non-retrievable geological disposal. The results of this analysis show that the usefulness of ethical matrixes is twofold and that they provide a valuable input for further decision-making. Indeed, by using ethical matrixes, implicit ethically relevant issues were revealed—namely issues of equity associated with health impacts and differences between close and remote future generations regarding ethical impacts. Moreover, the ethical matrix framework was helpful in synthesizing and comparing systematically the ethical impacts of the technologies under scrutiny, and hence in highlighting the potential ethical conflicts. (shrink)

Humans and animals make inferences about the world under limited time and knowledge. In contrast, many models of rational inference treat the mind as a Laplacean Demon, equipped with unlimited time, knowledge, and computational might. Following H. Simon's notion of satisficing, the authors have proposed a family of algorithms based on a simple psychological mechanism: one-reason decision making. These fast and frugal algorithms violate fundamental tenets of classical rationality: They neither look up nor integrate all information. By computer simulation, the (...) authors held a competition between the satisficing "Take The Best" algorithm and various "rational" inference procedures. The Take The Best algorithm matched or outperformed all competitors in inferential speed and accuracy. This result is an existence proof that cognitive mechanisms capable of successful performance in the real world do not need to satisfy the classical norms of rational inference. (shrink)

Elicitation methods in decision-making under risk allow us to infer the utilities of outcomes as well as the probability weights from the observed preferences of an individual. An optimally efficient elicitation method is proposed, which takes the inevitable distortion of preferences by random errors into account and minimizes the effect of such errors on the inferred utility and probability weighting functions. Under mild assumptions, the optimally efficient method for eliciting utilities and probability weights is the following three-stage procedure. First, a (...) probability is elicited whose subjective weight is one half. Second, the utility function is elicited through the midpoint chaining certainty equivalent method using the probability elicited at the first stage. Finally, the probability weighting function is elicited through the probability equivalent method. (shrink)

This paper argues that any specific utility or disutility for gambling must be excluded from expected utility because such a theory is consequential while a pleasure or displeasure for gambling is a matter of process, not of consequences. A (dis)utility for gambling is modeled as a process utility which monotonically combines with expected utility restricted to consequences. This allows for a process (dis)utility for gambling to be revealed. As an illustration, the model shows how empirical observations in the Allais paradox (...) can reveal a process disutility of gambling. A more general model of rational behavior combining processes and consequences is then proposed and discussed. (shrink)

This paper proposes several concepts of efficient solutions for multicriteria decision problems under uncertainty. We show how alternative notions of efficiency may be grounded on different decision ‘contexts’, depending on what is known about the Decision Maker's (DM) preference structure and probabilistic anticipations. We define efficient sets arising naturally from polar decision contexts. We investigate these sets from the points of view of their relative inclusions and point out some particular subsets which may be especially relevant to some decision situations.

Nearly all students believe academic cheating is wrong, yet few students say they would report witnessed acts of cheating. To explain this apparent tension, the present research examined college students’ reasoning about whether to report plagiarism or other forms of cheating. Study 1 examined students’ conflicts when deciding whether to report cheating. Most students gave reasons against reporting a peer (e.g., social and physical consequences, a lack of responsibility to report) as well as reasons in favor of reporting (e.g., concerns (...) about welfare, justice, and fairness). Study 2 provided experimental confirmation that the contextual factors referenced by Study 1 participants in fact influenced decisions about whether to report cheating. Overall, the findings indicate that students often decide against reporting peers’ acts of cheating, though not due to a lack of concern about integrity. Rather, students may refrain from reporting because of conflicting concerns, lack of information about school policy, and perceived better alternatives to reporting. (shrink)

Satisficing is a central concept in both individual and social multiagent decision making. In this paper we first extend the notion of satisficing by formally modeling the tradeoff between costs and decision failure. Second, we extend this notion of “neo”-satisficing into the context of social or multiagent decision making and interaction, and model the social conditioning of preferences in a satisficing framework.

Inspired by the operation of human social organisation, this paper presents a new architecture—a pyramid-committee—for developing society-oriented intelligence, whose structure imitates the organisation of human society in its decision making. The system takes a pyramid-like hierarchical structure with links in the pyramid forming a semi-lattice, which relate not only to nodes in the same layer, but also to others in different layers. The output of the system is a result of the negotiation and balancing of different interests. For such a (...) system to function, the main difficulties concern the complicated relationships between different factors or agents. Focussing on the airport environment audit, we discuss the development of a model framework and the role of neural networks. (shrink)

Being a formal and general as well as the most widely accepted approach to practical rationality, rational decision theory should be crucial for justifying rational morals. In particular, acting morally should also be rational in decision theoretic terms. After defending this thesis, in the critical part of the paper two strategies to develop morals following this insight are criticized: game theoretical ethics of cooperation and ethical intuitionism. The central structural objections to ethics of cooperation are that they too directly aim (...) at the rationality of moral action and that they to do not encompass moral values or a moral desirability function. The constructive half of the paper takes up these criticisms by developing a two-part strategy to bring rationality and morals in line. The first part is to define ‘moral desirability’. This is done, using multi-attribute utility theory, by equating several adequate components of an individual’s comprehensive utility function with the moral desirability function. The second part is to introduce mechanisms, institutions, in particular socially valid moral norms, that provide further motivation for acting in accordance with morals. (shrink)

Daniel Ellsberg presented in Ellsberg various examples questioning the thesis that decision making under uncertainty can be reduced to decision making under risk. These examples constitute one of the main challenges to the received view on the foundations of decision theory offered by Leonard Savage in Savage. Craig Fox and Amos Tversky have, nevertheless, offered an indirect defense of Savage. They provided in Fox and Tversky an explanation of Ellsberg’s two-color problem in terms of a psychological effect: ambiguity aversion. The (...) ‘comparative ignorance’ hypothesis articulates how this effect works and explains why it is important to an understanding of the typical pattern of responses associated with Ellsberg’s two-color problem. In the first part of this article we challenge Fox and Tversky’s explanation. We present first an experiment that extends Ellsberg’s two-color problem where certain predictions of the comparative ignorance hypothesis are not confirmed. In addition the hypothesis seems unable to explain how the subjects resolve trade-offs between security and expected pay-off when vagueness is present. Ellsberg offered an explanation of the typical behavior elicited by his examples in terms of these trade-offs and in section three we offer a model of Ellsberg’s trade-offs. The model takes seriously the role of imprecise probabilities in explaining Ellsberg’s phenomenon. The so-called three-color problem was also considered in Fox and Tversky. We argue that Fox and Tversky’s analysis of this case breaks a symmetry with their analysis of the two-color problem. We propose a unified treatment of both problems and we present a experiment that confirms our hypothesis. (shrink)

How can it be rational to work on a new theory that does not yet meet the standards for good or acceptable theories? If diversity of approaches is a condition for scientific progress, how can a scientific community achieve such progress when each member does what it is rational to do, namely work on the best theory? These two methodological problems, the problem of pursuit and the problem of diversity, can be solved by taking into account the cognitive risk that (...) is involved in theory choice. I compare this solution to other proposals, in particular T. S. Kuhn's and P. Kitcher's view that the two problems demonstrate the epistemic significance of the scientific community. (shrink)

We present a method to characterize the preferences of a decision maker in decisions with multiple attributes. The approach modifies the outcomes of a multivariate lottery with a multivariate transformation and observes the change in the decision maker’s certain equivalent. If the certain equivalent follows this multivariate transformation, we refer to this situation as multiattribute transformation invariance, and we derive the functional form of the utility function. We then show that any additive or multiplicative utility function that is formed of (...) continuous and strictly monotonic utility functions of the individual attributes must satisfy transformation invariance with a multivariate transformation. This result provides a new interpretation for multiattribute utility functions with mutual utility independence as well as a necessary and sufficient condition that must be satisfied when assuming these widely used functional forms. We work through several examples to illustrate the approach. (shrink)

Fairness can be incorporated into Harsanyi’s utilitarianism through all-inclusive utility. This retains the normative assumptions of expected utility and Pareto-efficiency, and relates fairness to individual preferences. It makes utilitarianism unfalsifiable, however, if agents’ all-inclusive utilities are not explicitly specified. This note proposes a two-stage model to make utilitarian welfare analysis falsifiable by specifying all-inclusive utilities explicitly through models of individual fairness preferences. The approach is applied to include fairness in widely discussed allocation examples.

Altruism is a popular economic explanation for a wide range of pro-social decisions and actions. It has been applied frequently in several different streams of literature, and is a descriptively compelling model of behavior. This paper provides a theoretical framework for the existence of ordinal and cardinal altruistic value functions, as well as altruistic utility functions, based on an altruistic preference relation. Representation theorems are developed to specify relatively weak conditions under which altruistic value and utility functions can be shown (...) to exist. In addition, conditions that lead to additive forms of these functions are provided. (shrink)

Ethical banking, microfinance institutions or certain credit cooperatives, among others, grant socially responsible loans. This paper presents a credit score system for them. The model evaluates social and financial aspects of the borrower. The financial aspects are evaluated under the conventional banking framework, by analysing accounting statements and financial projections. The social aspects try to quantify the loan impact on the achievement of Millennium Development Goals such as employment, education, environment, health or community impact. The social credit score model should (...) incorporate the lender’s know-how and should also be coherent with its mission. This is done using Multi-Criteria Decision Making. The paper illustrates a real case: a loan application by a social entrepreneur presented to a socially responsible lender. The decision support system not only produces a score, but also reveals strengths and weaknesses of the application. (shrink)

Most of the existing literature on social preferences either tests whether certain characteristics of the social context influence individual decisions, or tries to estimate parameters of social preference functions describing such behavior at the level of the entire population. In the present paper, we are concerned with measuring parameters of social preference functions at the individual level. We draw upon concepts developed for eliciting other types of utility functions, in particular the literature on decision making under incomplete information. Our method (...) derives parameters of social preference functions from indifference statements about the distribution of payoffs a group. We apply our method in a controlled social preference experiment to establish the external validity of estimated parameters. Our results show the expected relationships to some external factors and also a strong correspondence between parameter estimates and factors that, according to the subjects’ own descriptions, influenced their behavior. We also find that some concepts discussed in the literature on social preferences, in particular envy toward players receiving a larger payoff, have very diverse and complex effects at the individual level. (shrink)

Per definition business sustainability demands the integration of environmental, social, and economic outcomes. Yet, managerial decision-making involving sustainability objectives is fraught with tension and the way managerial decision-makers frame sustainability issues in their mindset influences how sustainability tensions are managed at the organisational level. In the bid to better understand what types of managerial mindsets, or cognitive frames, foster integrative business sustainability practices that simultaneously advance environmental, social, and economic objectives, extant research has focussed on the underlying logics that drive (...) the acknowledgement of sustainability tensions. However, the existing logics-based constructs do not sufficiently explain this link, and it has been suggested that managers perceive and manage sustainability tensions based on the values that they hold. To clarify the roles of managerial values and logics as antecedents in business sustainability decision-making, we integrate Keeney’s value-focussed thinking approach with managerial and organisational cognition perspectives. Drawing on data from a survey with 169 senior procurement managers in Australia we found three types of cognitive frames which demonstrate that stronger sustainability values are associated with a more holistic perception of sustainability tensions and vice versa. We also found that managers’ cognitive framing of sustainability is strengthened by more holistic organisational cognitive frames and discuss according implications for managerial decision-making in theory and practice. (shrink)

Non-compensatory aggregation rules are applied in a variety of problems such as voting theory, multi-criteria analysis, composite indicators, web ranking algorithms and so on. A major open problem is the fact that non-compensability implies the analytical cost of loosing all available information about intensity of preference, i.e. if some variables are measured on interval or ratio scales, they have to be treated as measured on an ordinal scale. Here this problem has been tackled in its most general formulation, that is (...) when mixed measurement scales (interval, ratio and ordinal) are used and both stochastic and fuzzy uncertainties are present. Objectives of this article are first to present a comprehensive review of useful solutions already proposed in the literature and second to advance the state of the art mainly in the theoretical guarantee that weights have the meaning of importance coefficients and they can be summarized in a voting matrix. This is a key result for using non-compensatory Condorcet consistent rules. A proof on the probability of existence of ties in the voting matrix is also developed. (shrink)

We propose a descriptive version of the classical multi-attribute utility model; to that end, we add a new parameter, momentary salience, to the customary formulation. The addition of this parameter allows the theory to accommodate changes in the decision maker’s mood and circumstances, as the saliencies of anticipated consequences are driven by concerns of the moment. By allowing for the number of consequences given attention at the moment of decision to vary, the new model mutes the criticism that SEU models (...) call for an omniscient decision maker. Use of the model is illustrated with a large-scale longitudinal study showing that adolescent smokers have higher utility for smoking than nonsmokers. We also propose to use the model hierarchically to describe everyday decisions that people deal with repeatedly. Big decisions, which set policy, guide a host of nested little decisions, which in turn lead to action. For a little decision, one of the options will be consistent with the policy, and will inherit its high utility. Accordingly, most little decisions will be made quickly and will follow the policy. However, people do sometimes decide to violate their own policies, and we describe how these lapses can lead to collapse of the policy. (shrink)

Research on environmental-decision making is usually based on utilitarian models, which imply that people's decisions are only influenced by the outcomes. This research provides evidence for values and moral positions that reflect nonconsequentialist rather than consequentialist views. In doing this, this article refers to “sacred values,” which are values that are seen as not-substitutable and nontradable. Two studies were designed to examine evidence for sacred values and their role on act versus omission choices within the environmental domain. The studies revealed (...) that sacred values were closely associated with preferences for actions, trade-off reluctance, deontological focus, and position of moral universalism. The results suggest that it is important to account for sacred values and nonconsequentialist views in environmental decision-making research. (shrink)

I examine the foundations of a just society using the lens of decision theory. The conception of just society is from an individual’s viewpoint: where would I rather live if I have an equal chance of being any individual? Three alternative designs for a just society are examined. These are: laissez-faire, maximin and social minimum. Two assumptions about human nature clarify the distinction among three societies. The first assumption is that a representative individual’s utility function is concave. The second assumption (...) recognizes that redistribution to achieve equality reduces total wealth. A rational individual would prefer a society where one is free to maximize one’s expected utility. A social minimum that includes both the provision of essential human needs and equality of opportunity (education, healthcare, access to capital) for a flourishing life emerges as a candidate solution for the basic structure of society. (shrink)

In the paper we consider an electricity provider company that makes decision on allocating resources on electric network maintenance. The investments decrease malfunction rate of network nodes. An accidental event or a malfunctioning on underground system can have various consequences and in different perspectives, such as deaths and injuries of pedestrians, fires in nearby locations, disturbances in the flow of vehicular traffic, loss to the company image, operating and financial losses, etc. For this reason it is necessary to apply an (...) approach of the risk management that considers the multidimensional view of the consequences. Furthermore an analysis of decision making should consider network dependencies between the nodes of the electricity distribution system. In the paper we propose the use of the simulation to assess the network effects in the multidimensional risk assessment in electricity grid. The analyzed effects include node overloading due to malfunction of adjacent nodes and blackouts that take place where there is temporarily no path in the grid between the power plant and a node. The simulation results show that network effects have crucial role for decisions in the network maintenance – outcomes of decisions to repair a particular node in the network can have significant influence on performance of other nodes. However, those dependencies are non-linear. The effects of network connectivity on its multidimensional performance assessment depend heavily on the overloading effect level. The simulation results do not depend on network type structure – however simulation outcomes for random networks have shown higher variance compared to small-world networks. (shrink)