15 Multi Objective Evaluation Criteria for Infrastructure . . . . . . . . . . 411
15.1
Multi-criteria Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 412
15.1.1
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 412
15.1.2
Multi-criteria Evaluation Models . . . . . . . . . . . . . . . 413
15.2
The Simple Additive Weighting (SAW) Model . . . . . . . . . . . 414
15.3
The Simple Additive Weighting Method in Practice . . . . . . . . 416
15.4
Sensitivity Testing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 418
15.5
Probabilistic Additive Weighting . . . . . . . . . . . . . . . . . . . . . . 422
15.5.1
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 422
15.5.2
Expected Value . . . . . . . . . . . . . . . . . . . . . . . . . . . 423
15.5.3
Variance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 423
15.6
Allocating Weights to the Decision Criteria . . . . . . . . . . . . . . 427
15.6.1
Presumption of Equal Weights . . . . . . . . . . . . . . . . 427
15.6.2
Ranking System for Obtaining Weights . . . . . . . . . . 427
15.6.3
Ratio System for Obtaining Weights . . . . . . . . . . . . 429
15.6.4
Pairwise Comparison Weighting System . . . . . . . . . 430
15.6.5
The Resistance-to-Change Grid . . . . . . . . . . . . . . . 431
15.6.6
Hierarchy of Weights . . . . . . . . . . . . . . . . . . . . . . . 433
15.6.7
Multiple Weighting Systems . . . . . . . . . . . . . . . . . . 436
15.6.8
Scoring Systems for the Criteria . . . . . . . . . . . . . . . 438
15.7
Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 439
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 440
16 Decision Taking with Infrastructure . . . . . . . . . . . . . . . . . . . . . . . . 441
16.1
Risk Assessment and Management . . . . . . . . . . . . . . . . . . . . 442
16.1.1
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 442
16.1.2
Risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 442
16.1.3
Risk Management . . . . . . . . . . . . . . . . . . . . . . . . . 444
16.2
Decision Theory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 445
16.2.1
Steps in Decision Theory Approach . . . . . . . . . . . . 445
16.3
Decision Making Environments . . . . . . . . . . . . . . . . . . . . . . . 446
16.4
Decision Making Under Conditions of Certainty . . . . . . . . . . 447
16.5
Decision Making Under Conditions of Uncertainty . . . . . . . . . 447
16.5.1
Maximax Criterion . . . . . . . . . . . . . . . . . . . . . . . . 448
16.5.2
Maximin Criterion . . . . . . . . . . . . . . . . . . . . . . . . . 449
16.5.3
Minimax Regret Criterion . . . . . . . . . . . . . . . . . . . 449
16.5.4
Hurwicz Criterion (Criterion of Realism) . . . . . . . . . 450
16.5.5
Laplace Criterion (Criterion of Rationality) . . . . . . . 452
16.6
Decision Making Under Conditions of Risk . . . . . . . . . . . . . . 454
16.6.1
Expected Value Criterion . . . . . . . . . . . . . . . . . . . . 454
16.6.2
Expected Opportunity Loss (EOL) Criterion . . . . . . 456
16.6.3
Expected Value of Perfect Information (EVPI) . . . . . 459
16.6.4
EMV for Items That Have a Salvage Value . . . . . . . 461
16.6.5
Use of Incremental (Marginal) Analysis . . . . . . . . . 464
16.6.6
Maximum Likelihood Criterion . . . . . . . . . . . . . . . 466
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