Article ID: | iaor201497 |
Volume: | 211 |
Issue: | 1 |
Start Page Number: | 289 |
End Page Number: | 299 |
Publication Date: | Dec 2013 |
Journal: | Annals of Operations Research |
Authors: | Kou Gang, Ergu Daji, Lin Changsheng |
Keywords: | decision theory: multiple criteria |
The pair‐wise comparison matrix (PCM) is widely used in multi‐criteria decision making methods. If the PCM is inconsistent, the resulting priority vector is not reliable. Hence, it is necessary to measure the level of the inconsistency of the PCM. There are two approaches for testing the consistency of the PCM: deterministic approaches and statistical or stochastic approaches. In this paper, an improved statistical approach to test the consistency of the PCM is proposed, which combines hypothesis test and maximum likelihood estimation. The proposed statistical approach is flexible and reliable because it sets a suitable significance level according to different situations. Two numerical examples are introduced to illustrate the proposed statistical approach.