ECO0012 - DECISION THEORY AND MULTI-CRITERIA ANALYSIS

Students will gain the following skills:

1) Knowledge and understanding: students will learn a disciplined, structured approach to rational decision-making without and with uncertainty.

2) Applying knowledge and understanding: students will be able to
- account for fundamental aspects of Multi-Criteria Decision Analysis (MCDA) and Decision-Making Under Uncertainty (DMUU)
- apply basic principles of MCDA and DMUU in different cases
- apply stochastic optimization to model and solve decision-making problems under uncertainty
- make sound decisions that account for uncertainty and an individual’s risk attitude
- employ sensitivity analysis and value of information to understand key factors influencing the decision.

3) Making judgements: students who successfully complete this course will be able to select the most appropriate decision theory models, implement the models using dedicated software in specific economic and business problems; and draw the main conclusions on the best decision to take.

4) Communication skills: by the end of the module, students should be able to understand and explain the basic concepts of multi-criteria optimization, to formulate real-world decision-making problems as optimization problems, to discuss different solution concepts, their advantages and their limitations in practice, to apply and justify several solution methods for multi-criteria optimization problems and discuss their drawbacks and their advantages.

5) Learning skills: the contents of the course are provided through various teaching methods. They aim not only at developing the ability of understanding and applying knowledge, with independent judgment and adequate communication skills, but also at increasing the knowledge on contents similar to those of teaching. Additionally, students will be able to apply the decision methods in professional life and develop skills for further self-study.