Title: Ranking risk attitudes using an integrated AHP-TOPSIS approach

Authors: Lubna Obaid; Haneen Abuzaid; Dorid Dalalah; Salhah Alhassani; Fouzeya Albastaki; Tania El Khalil

Addresses: Department of Civil and Environmental Engineering, College of Engineering, University of Sharjah, Sharjah, United Arab Emirates ' Department of Industrial Engineering and Engineering Management, College of Engineering, University of Sharjah, Sharjah, United Arab Emirates ' Department of Industrial Engineering and Engineering Management, College of Engineering, University of Sharjah, Sharjah, United Arab Emirates ' Department of Industrial Engineering and Engineering Management, College of Engineering, University of Sharjah, Sharjah, United Arab Emirates ' Department of Industrial Engineering and Engineering Management, College of Engineering, University of Sharjah, Sharjah, United Arab Emirates ' Department of Industrial Engineering and Engineering Management, College of Engineering, University of Sharjah, Sharjah, United Arab Emirates

Abstract: Due to the ambiguity between risk attitudes, this study aims at ranking the different risk attitudes considering the factors that affect the behaviour of the decision-makers. Both the technique for order preference by similarity to ideal solution (TOPSIS) and analytical hierarchy process (AHP) are employed to address the characteristics of risk attitudes aiming to highlight the criteria significance and finally to rank the most impactful risk attitude. It was found that regret aversion and risk aversion attitudes have higher impact in real life decision-making problems. In contrast, the maximin and maximax risk attitudes have the lowest importance. Risk seeking and regret aversion attitudes demonstrated the highest importance using TOPSIS of equal-weights while the importance of loss aversion and regret aversion have the highest for the AHP-TOPSIS approach. The results of this study can be beneficial for decision-makers who encounter a variety of risk attitudes in their decision problems.

Keywords: TOPSIS; regret aversion; analytical hierarchy process; AHP; risk attitudes; multi-criteria decision-making; MCDM.

DOI: 10.1504/IJADS.2022.120279

International Journal of Applied Decision Sciences, 2022 Vol.15 No.1, pp.68 - 99

Received: 09 Jun 2020
Accepted: 27 Sep 2020
Published online: 13 Jan 2022 *

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