An Emergency Decision Making Method Based on Prospect Theory for Different Emergency Situations

Abstract

Emergency decision making (EDM) is an effective way to deal with emergency situations because of its prominent role in alleviating the losses of properties and lives caused by emergency events. It has drawn increasing attention from both governments and academia, and become an important research topic in recent years. Studies show that decision makers are usually guided by bounded rationality under risk and uncertainty conditions. Their psychological behavior plays an important role in the decision making process, and EDM problems are usually characterized by high risk and uncertainty. Thus, decision makers’ psychological behavior has been considered in existing EDM approaches based on prospect theory. An emergency event might evolve into different situations due to its dynamic evolution, which is one of the distinctive features of emergency events. This important issue has been discussed in existing EDM approaches, in which different emergency situations are dealt with by devising different solutions. However, existing EDM approaches do not consider decision makers’ psychological behavior together with the different emergency situations and the different solutions. Motivated by such limitation, this study proposed a novel approach based on prospect theory considering emergency situations, which considers not only decision makers’ psychological behavior, but also different emergency situations in the EDM process. Two examples and related comparison are provided to illustrate the feasibility and validity of this approach.

Keywords

Emergency situations / Emergency decision making / Prospect theory / Psychological behavior

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