decision theory


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decision theory

[di′sizh·ən ‚the·ə·rē]
(systems engineering)
A broad spectrum of concepts and techniques which have been developed to both describe and rationalize the process of decision making, that is, making a choice among several possible alternatives.

decision theory

(probability)
A branch of statistics concerning strategies for decision making in non-deterministic systems. Decision theory seeks to find strategies that maximise the expected value of a utility function measuring the desirability of possible outcomes.
References in periodicals archive ?
As mentioned above, behavioral decision theory arguments suggest that managerial decisions are guided to a large extent by associated downside risks.
rule-based decision theory is far more realistic and empirically
In decision theory, utility is a measure of the desirability of consequences of the courses of action that applies to decision making under the risk, i.
The next three chapters discuss Decision theory, Markov Chains and Theory of Games respectively.
When one considers that there are only four parameters in the Bayesian Decision Theory model (the mean and variance of the measurement of individual characteristics along with the mean and variance of the group characteristic), the above multiplicity of mechanisms ascribed to the concept of statistical discrimination can be seen as potentially relating to all of these components.
Abundant evidence in the area of behavioral decision theory research has demonstrated that reframing invariant alternatives in positive or negative terms influences choice (Tversky & Kahneman, 1981).
Decision theory was also known early on, and I published "The Use of Decision Theory in Meteorology with an Application to Aviation Weather" in Monthly Weather Review in 1964.
The way skewness and kurtosis entered in the expression (2) is in direct link with what decision theory suggests about preferences about the third and fourth moments of a risky outcome.
It is interesting to note that classical decision theory remained popular for 500 years and formed the basis of many economic theories.
The decision theory school, according to Kuntz, is concerned with the making of a decision between two or more alternatives.
Insight into decision theory and human information processing can assist midwives understand how they might utilise such knowledge to facilitate their role in the decision process.
Game theory and decision theory are enormously useful in explaining presidential elections and politics in general, according to Brams, a professor of politics at New York University.

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