Using Stakeholders Preferences in Multi-attribute Decision Making: Elicitation and Aggregation Issue

This paper reviews the challenges in applying multi-attribute decision making (MADM) tools to complex environmental resource management problems. MADM tools offer a means of selecting among different alternatives (projects, programmes, futures etc..), they provide a framework in which to display data, and are frequently used to incorporate stakeholder preferences. In many instances, MADM applications have implicitly applied axioms of consumer preference and utility theory, without managing the consequences of those assumptions. In particular, it is frequently assumed in MADM tools that utility functions can be defined for individuals; that indifferences curves are continuous and downward sloping; and that evaluation criteria are compensatory. A growing body of literature on lexicographic preferences suggests otherwise. Difficulties associated with preference elicitation and aggregation also constrain the usability of MADM tools. While these problems have been addressed in the contingent valuation method (CVM) literature, the lessons learned have been slow to be transferred to the area of MADM. In conclusion, recognising the theoretical limitations of MADM tools could lead to alternative uses for such tools, such as representation aids for stakeholder engagement or conflict management