Abstract
Several power system problems require solutions in an uncertain environment. According to the relevant literature, expected utility theory (EUT) has been used extensively to solve such problems. However, the application of Prospect Theory (PT) has demonstrated that people deviate from the expected utility maximization because their effective behaviors reflect loss aversion and risk-seeking, reflection effects. The aim of this paper was to compare and critically analyze EUT and PT with the goal of outlining the different behaviors of a “real” decision maker (DM) and an “ideal” DM, with the real DM operating in the frame of PT and the ideal DM operating as EUT describes. The results of using the two different theories were compared by solving three power-system problems in uncertain scenarios.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callMore From: International Journal of Electrical Power & Energy Systems
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
