Fuzzy Rationality in Quantitative Decision Analysis
Natalia Nikolova*, Aleksei Shulus**, Daniela Toneva***, and Kiril Tenekedjiev*
Technical University of Varna, Dept. of Economics and Management, 1 Studentska Str., 9010 Varna, Bulgaria
**Academy of Labor and Social Relations, Moscow, Russia, 117454 Lobachevskogo 90
***Eley K&K, Ltd., Varna, Bulgaria, Mladost, bl. 139, entr. 1, app. 19
The paper presents a discussion on fuzzy rationality in the elicitation of subjective probabilities and utilities. In addition to previous research, two functions, measuring the degree of preference of the real decision maker on both sides of the uncertainty interval are introduced, and their relationship with the indifference function, measuring the degree of indifference of the decision maker over gambles, is analyzed and graphically interpreted. A new relation — hesitation — is introduced to give a better description of the actual process of subjective elicitation by real decision makers. The influence of the preference-hesitation combination in an elicitation process is presented graphically, and it is argued that the resulting uncertainty interval is much tighter than the one, resulting from the preference-indifference based elicitation.