Cost-Benefit Analysis and the Theory of Fuzzy Decisions

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1 Kofi K. Dompere Cost-Benefit Analysis and the Theory of Fuzzy Decisions Identification and Measurement Theory fyj Springer

2 1 Decision, Cost and Benefit Decision and Choice A Reflection on Cost-Benefit Analysis A General Analytical Structure of Cost-Benefit Analysis The Decision Structure and Cost-Benefit Analysis The Basic Social Welfare Foundation of Cost-Benefit Analysis Costs-Benefit Analysis and other Decision Tools Taxonomy of Decision Tools The Classical Operations Research for Decision-Making Some Non-Classical Operations Research for Decision Making Introductory Framework of the Theory of Fuzzy Decisions for Cost-Benefit Analysis 27 2 The Theory of Computable Cost-Benefit Identification Matrices Multi-Objective, Multi-Alternative, Multi-Attribute and Multi- Group Problem in Cost-Benefit Analysis The Structure of Identification Matrices Reflections on Contingent Valuation Method (CVM), Revealed Preference Method (RPM), Computable Identification Matrices and the Role of the Theory of Fuzzy Decisions Computable Cost-Benefit Identification Matrices and other Areas of Decision Applications The Logic of Computable Cost-Benefit Identification Matrices The Goals and Objectives of the Theory of Computable Cost and Benefit Identification Matrices Areas of Potential Application Security and Risk Analysis Computable Cost-Benefit Identification Matrices and the Study of Quality of Life 77

3 xvi 3 The Theory of Social Cost and Costing Categories of Choice or Decision in Cost-Benefit Analysis The Concept of Cost in Decision and Cost-Benefit Analysis A Note on the Concept of Cost in Decision and Choice The Cost Components and Decision Cost, Choice and Decision The Cost Space and Identification Matrix The Cost Space Defined Cost Identification Matrix for Costing The Burden of Social Cost and Cost Distributional Weights Constructing the Distributional Weights Tangibles, Intangibles, Prices and Cost Aggregates The Effect of Time on Cost Computing Example of Social Costing: The Social Cost of Mental Illness Identification of Real Cost Characteristics Social Groups (Classes) Forming the Computable Cost-Identification Matrix Computing the Aggregate Cost Data Conclusion The Steps in Social Costing The Theory of Social Benefits and Benefit Accounting A Rationale for the Basic Framework A Reflection on the Concept of Benefit in a Choice- Decision Process Accounting Concept and Measurement of Benefits The Economic Concept and Measurement of Benefits The Structure of Benefit Space and Decision Alternatives Benefit Identification Matrix for Benefit Accounting Tangibles, Intangibles, Corresponding Prices and Benefit Aggregates The Concept of Benefit Intensity and Distributional Weights The Construction of Class Benefit Intensity Weights Through Fuzzy Aggregation Conclusion and Effect of Time on Benefit Data and Accounting An Example of Social Benefits and Benefit Accounting: Treatment of Mental Illness Developing the Required Initial Information Base On Fuzzy Computing and Distributional Weights of Benefit Intensities and Aggregation 165

4 xvii 5 Essential Mathematics for Fuzzy Decision Processes The Basis of the Theory of Fuzzy Mathematics Simple Operations on Fuzzy Sets Visual Representation of Fuzzy-Set Operations Distance Functions on Fuzzy Sets Basic Indexes of Fuzziness in Sets The a -Level Sets and the Decomposition Theorem Fuzzy Graphs and Fuzzy Relations Joint and Marginal Membership Functions Decomposition and Fuzzy Relations Some other Useful Fuzzy Set Operations Categories and Graphs of some Common Membership Functions Membership Functions for "x is small" Membership Functions for "x is large" Basic Arithmetic of Fuzzy Numbers Fuzzy Numbers and Fuzzy Confidence Intervals Basic Fuzzy Arithmetic on Fuzzy Numbers The Basic Theory of Fuzzy Decisions The Fuzzy Decision Problem The Fuzzy Decision Problem Extended The Fuzzy Mathematical Programming (FMP) The Formulation of the Fuzzy Mathematical Programming Problem The a -level Function of FMP Fuzzy Multicriteria Decision Making Problem Definition Acomputational Example of Fuzzy Multicriteria Decision Problem Reflections on the General Fuzzy Decision Processes 293 References 297 On Aggregation, Distributional Weights, and Rankings 297 On Economic Analysis, Benefits and Benefit Accounting 303 On Economic Analysis, Costs and Costing 307 On Accounting Theory 311 On Economic Analysis, Cost-Benefit, and Investment Criteria On Economic Analysis, Cost-Benefit and Investment Criteria II 315 On Economic Analysis, Shadow Prices and Efficient Pricing 317 On Economic Analysis and Social Rate of Discount 324 On Economics and Social Choice 327

5 xviii On Economic and General Cost-Benefit Analysis: Contingent Valuation Method (CVM) 340 On Economic and General Cost-Benefit Analysis: Revealed Preference Approach (RPA) 345 On Fuzzy Decisions 349 On Fuzzy Decisions and Some Applications 360 On Fuzzy Decisions, Risks, Games and Economic Analysis 367 On Fuzzy Logic 373 On Fuzzy Mathematical Programming and the Theory of Fuzzy Optimization 377 On Fuzzy Mathematics 382 On Fuzzy Probability, Possibility and Statistics 391 Index 395