A prospect theory-based interval dynamic reference point method for emergency decision making

Abstract

Urgent or critical situations, such as terrorist attacks and natural disasters, often require decision makers (DMs) to take crucial decisions. Emergency decision making (EDM) problems have become a very active research field in recent years. The existing studies focus mainly on the information inadequacy or incomplete information in emergencies, and selecting ideal emergency alternatives, neglecting the psychological behavior of DMs under emergencies. Few studies consider a DM's psychological behavior, although there is some focus on the dynamic features of emergency events and limited DM judgments under risk and uncertainty. Motivated by such problems, this study proposes a prospect theory-based interval dynamic reference point method for EDM. The technique for order preference by similarity to ideal solution (TOPSIS) method is a popular decision technique, as decision makers are always bounded rational under risk and uncertainty and their psychological behavior plays an important role in EDM. However, the existing TOPSIS methods are seldom concerned with this issue. Based on such a problem, this study proposes a TOPSIS method with an interval reference point, which considers the DM's psychological behavior. Two examples are presented to illustrate the feasibility and validity of the proposed methods for solving EDM problems in the real world. Based on the final rankings of alternatives in the examples, each of our methods validates the other and matches the actual EDM.