Are incomplete and self-confident preference relations better in multicriteria decision making? A simulation-based investigation

Abstract

Incomplete preference relations and self-confident preference relations have been widely used in multicriteria decision-making problems. However, there is no strong evidence to validate their use in decision-making in the current literature. This paper reports on the design of two bounded rationality principle based simulation methods, and detailed experimental results that aim at providing evidence to answer the following two questions: (1) what are the conditions under which incomplete preference relations are better than complete preference relations?; and (2) can self-confident preference relations improve the quality of decisions? The experimental results show that when the decision-maker is of medium rational degree, incomplete preference relations with a degree of incompleteness between 20% and 40% outperform complete preference relations; otherwise, the opposite happens. Furthermore, in most cases the quality of the decision making improves when using self-confident preference relations instead of incomplete preference relations. The paper ends with the presentation of a sensitivity analysis that contributes to the robustness of the experimental conclusions.