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2008 | Buch

Social Multi-Criteria Evaluation for a Sustainable Economy

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The real world is characterized by deep complexity. May be a rather unremarkable observation, yet it has important implications on the manner policy problems are represented and decision-making is framed. Is contemporary democracy compatible with science in real-world policy-making? This book gives answers in the affirmative. It also asserts that this congruence can have positive implications not only in terms of economic prosperity but also when dealing with the difficult sustainability policy problems of our millennium. To address contemporary issues economic science will have to expand its empirical relevance by introducing more and more realistic assumptions to its models. One of the most interesting research orientations in recent times in the field of public economics is the explicit attempt to take account of political constraints, interest groups and collusion effects. One of the main novelties of this book is its establishment of a clear relationship between social and public choice theories on one hand, and multiple criteria decision analysis on the other. The pioneering research developed by Arrow and Raynaud (1986) has shown that the relationships between multi-criteria decision theory and social choice are clear and relevant. The main directions of cross-fertilization between these research fields are twofold: 1. Multi-criteria decision theory can be an adequate framework for applied social (and public) choice. 2. Social choice can produce interesting theoretical results for ensuring the ax- matic consistency needed by multi-criterion aggregation conventions.

Inhaltsverzeichnis

Frontmatter

Methodological Foundations and Operational Consequences of Social Multi-Criteria Evaluation (SMCE)

1. Introduction
Let us start the discussion of multi-criteria evaluation by means of a simple everyday life example. Let us imagine staying in front of a shop and admiring a selection of jackets. What is the next step? Probably entering the shop and asking for the price. At this point, we have two possibilities: leaving the shop because we think the price is too high or accepting the price as reasonable. In the second case, we still need to choose the jacket we want from the original set (of, for example, ten jackets). We are therefore, probably going to try on the jackets and see which one suits us best aesthetically. Let us assume that we are then still undecided between four of them, although we definitely do not like the other six. How do we choose between the remaining four? Perhaps at this stage we will use the criterion of colour. Let us imagine we are then still undecided between two jackets. We will now look at the quality of the fabric and we may finally choose the one with the better quality.
2. Dealing with a Complex World: Multiple Dimensions, Values and Scales
The world is characterized by deep complexity. This apparently unremarkable observation has important implications for the manner in which policy problems are represented and decision-making is framed. One may decide to adopt a reductionistic approach by tackling only one of the many possible dimensions or one may try to deal with the complexity of the real-world. This book adopts the latter approach. My firm conviction is that any representation of a complex system reflects only a sub-set of its possible representations. A system is complex when the relevant aspects of a particular problem cannot be captured using a single perspective (Rosen, 1977; O'Connor et al., 1996; Funtowicz et al., 1999).
3. Operationalizing Technical and Social Incommensurability in an SMCE Framework
One should note that the construction of a descriptive model of a real-world system depends on very strong assumptions about (1) the purpose of this construction, e.g. to evaluate the sustainability of a given city, (2) the scale of analysis, e.g. a block inside a city, the administrative unit constituting a commune or the whole metropolitan area and (3) the set of dimensions, objectives and criteria used for the evaluation process. A reductionistic approach to building a descriptive model could be defined as the use of just one measurable indicator (e.g. the monetary city product per person), one dimension (e.g. economic), one scale of analysis (e.g. the Commune), one objective (e.g. the maximization of economic efficiency) and one time horizon. If one wants to avoid reductionism, it will be necessary to take incommensurable dimensions into account and to use different scientific languages describing disparate but legitimate representations of the same system. This is what Neurath (1973) called the need for an “orchestration of sciences”.

Consistency in Social Multi-Criteria Evaluation

4. The Issue of Consistency: Basic Methodological Concepts
5. The Issue of Consistency: Basic Discrete Multi-Criteria “Methods”
The clearest presentation of the theoretical framework of Multi-Attribute Value and Utility Theory can be found in Keeney and Raiffa (1976). Keeney (1992) focuses mainly on operational aspects while Beinat (1997) develops a series of real-world case studies in which value functions are used for environmental management problems. The main characteristic of this approach is that all its formal properties are completely known.
6. The Issue of Consistency: Lessons Learned from Social Choice Literature
Vansnick (1990) showed that the two main approaches in multi-criteria decision theory i.e. compensatory and non-compensatory can be directly derived from the seminal work of Borda (1784) and Condorcet (1785). Indeed from the social choice literature, it can be seen that various ranking procedures used in multi-criteria methods have their origins in social choice. To give a few examples: the weakness-strength approach, typical of outranking and PROMETHEE methods (Brans et al., 1986; Roy, 1996), has a clear derivation from two Condorcet consistent rules, i.e. the Copeland (1951) and Simpson rules (1969); Arrow—Raynaud proposed a sequential procedure (building on Köhler, 1978) which is also based on some principles of the Condorcet rule; the so-called frequency matrix approach (Hinloopen et al., 1983; Matarazzo, 1988) comes directly from Borda algorithm, or the permutation method (Paelinck, 1978), has a strong connection with the so-called Kemeny's method, and so on.

Mathematical Procedures to Search for Technical and Social Compromise Solutions

7. Searching for the “Technical Compromise Solution”: Solving the Discrete Multi-Criterion Problem in an SMCE Framework
Given a set of evaluation criteria G = {g m }, m = 1, 2,…, M, and a finite set A = {a n }, n = 1, 2,…, N of potential alternatives (actions), let us start with the simple assumption that the performance (i.e. the criterion score) of an alternative a n with respect to a judgement criterion g m is based on an interval or ratio scale of measurement. For simplicity's sake, it is assumed that a higher value of a criterion is preferred to a lower one (i.e. the higher, the better). The pair-wise comparison of alternatives proposed here is a preference modelling structure based on the so-called threshold model and fuzzy preference relations.
8. Searching for the “Social Compromise Solution”: A Conflict Analysis Procedure for Illuminating Distributional Issues
As discussed in Chap. 1, one of the most interesting research directions in modern public economic policy is the explicit attempt to take political constraints, interest groups and collusion effects into account. The issue of “distributional coalitions” has been considered of key importance in determining growth factors (Olson, 1982). In the framework of sustainability policies, the need to deal with conflicts among various social actors is even more unavoidable.
9. Conclusions
A proper evaluation of sustainability options needs to deal with the plurality of legitimate values and interests coexisting in society. In empirical evaluations of public projects and publicly provided goods, multi-criteria decision analysis seems to be an appropriate policy tool, since it makes it possible to take into account a wide range of assessment criteria (e.g. environmental impact, distributional equity, and so on) and not simply profit maximization, as a private economic agent might do. However, the management of a policy process involves many layers and kinds of decisions, and requires the construction of a dialogue process between many social actors, individual and collective, formal and informal, local and beyond.
Backmatter
Metadaten
Titel
Social Multi-Criteria Evaluation for a Sustainable Economy
verfasst von
Giuseppe Munda
Copyright-Jahr
2008
Verlag
Springer Berlin Heidelberg
Electronic ISBN
978-3-540-73703-2
Print ISBN
978-3-540-73702-5
DOI
https://doi.org/10.1007/978-3-540-73703-2