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Testing best practices to reduce the overconfidence bias in multi-criteria decision analysis

Ferretti, Valentina, Guney, Sule, Montibeller, Gilberto and Winterfeldt, Detlof von (2016) Testing best practices to reduce the overconfidence bias in multi-criteria decision analysis. Proceedings of the 49th Annual Hawaii International Conference on System Sciences. pp. 1547-1555. ISSN 1530-1605

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Identification Number: 10.1109/HICSS.2016.195

Abstract

This paper explores the effectiveness of several methods to reduce the overconfidence bias when eliciting continuous probability distributions in the context of multicriteria decision analysis. We examine the effectiveness of using a fixed value method (as opposed to the standard fixed probability method) and the use of counterfactuals and hypothetical bets to increase the range of the distributions and to correct possible median displacements. The results show that the betting procedure to correct the median is quite effective, but the methods to increase the range of estimates have only a have small, but positive effect.

Item Type: Article
Official URL: http://ieeexplore.ieee.org/Xplore/home.jsp
Additional Information: © 2016 IEEE
Divisions: Management
Subjects: H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
H Social Sciences > HD Industries. Land use. Labor > HD61 Risk Management
Sets: Departments > Management
Date Deposited: 19 Jul 2016 14:50
Last Modified: 20 Apr 2019 01:30
Projects: SES-1314644, 2010-ST-061-RE0001
Funders: National Science Foundation, U.S Department of Homeland Security
URI: http://eprints.lse.ac.uk/id/eprint/67179

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