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A Knowledge-Based Risk Measure From the Fuzzy Multicriteria Decision-Making Perspective

Published on May 1, 2019in IEEE Transactions on Fuzzy Systems 8.41
· DOI :10.1109/tfuzz.2018.2838064
Chunbing Bao3
Estimated H-index: 3
(CAS: Chinese Academy of Sciences),
Dengsheng Wu10
Estimated H-index: 10
(CAS: Chinese Academy of Sciences),
Jianping LiXiaolei19
Estimated H-index: 19
(CAS: Chinese Academy of Sciences)
Abstract
Risk measures play significant roles in determining the magnitude of risks. The traditional risk measures consider only the consequence (C) and the probability (P) and ignore the support of the knowledge behind to estimate C and P . Several researchers have suggested adding knowledge as a third dimension in the risk measures. However, the issues of how to embed the dimension of knowledge in the risk measures to output an explicit expression of the risk measure and how to measure the strength of knowledge remain unresolved. This paper proposes a new risk measure incorporating the dimension of knowledge, apart from C and P . It is shown that the proposed risk measure has the form of traditional risk measures when the risk assessor has full knowledge. In addition, a fuzzy multicriteria decision-making (MCDM) method is employed to assess the strength of knowledge. In the fuzzy MCDM method, an entropy optimization problem is solved to obtain fuzzy measures, which are critical for determining the score of the strength of knowledge. Finally, the proposed method is applied to a project risk assessment, showing the feasibility of the method.
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Newest
Published on May 4, 2018in Journal of Risk Research 1.38
Chunbing Bao3
Estimated H-index: 3
(CAS: Chinese Academy of Sciences),
Jianping LiXiaolei19
Estimated H-index: 19
(CAS: Chinese Academy of Sciences),
Dengsheng Wu10
Estimated H-index: 10
(CAS: Chinese Academy of Sciences)
Extant research has focused upon assessing individual risks with the aid of risk matrices. Although risk aggregation is an important issue in risk management, aggregation of risks measured by risk matrices remains unresolved despite the wide usage of risk matrices. This paper proposes a framework to resolve the problem. We start from modifying the two notions of non-aggregatability of risk matrices, namely, qualitative description of inputs and non-comparability of different types of consequence...
6 Citations Source Cite
Published on Jan 1, 2018in Risk Analysis 2.90
Jianping LiXiaolei19
Estimated H-index: 19
(CAS: Chinese Academy of Sciences),
Chunbing Bao3
Estimated H-index: 3
(CAS: Chinese Academy of Sciences),
Dengsheng Wu10
Estimated H-index: 10
(CAS: Chinese Academy of Sciences)
Risk matrices have been widely used as a risk evaluation tool in many fields due to their simplicity and intuitive nature. Designing a rating scheme, i.e., determining the number of ratings used in a risk matrix and assigning different ratings to different cells, is an essential part of risk matrix construction. However, most of the related literature has focused on applying a risk matrix to various fields, instead of researching how to design risk matrices. Based on the analysis of several curr...
7 Citations Source Cite
Published on Jan 1, 2018in European Journal of Operational Research 3.43
Jianping LiXiaolei19
Estimated H-index: 19
(CAS: Chinese Academy of Sciences),
Xiaoyang Yao2
Estimated H-index: 2
(CAS: Chinese Academy of Sciences)
+ 1 AuthorsDengsheng Wu10
Estimated H-index: 10
(CAS: Chinese Academy of Sciences)
We consider multiple criteria decision aiding (MCDA) in the case of interactions between criteria. In dealing with interactions between criteria, fuzzy measures and integrals have demonstrated great advantages. Nevertheless, the determination of fuzzy measures has proven difficult because the capacities of not only single criterion but also all subsets of criteria need to be identified. Due to the value judgment essence of MCDA, the attitudes of the decision maker (DM) are typically modeled to i...
13 Citations Source Cite
Published on Dec 1, 2017in Management Science 3.54
Axel Gandy11
Estimated H-index: 11
(Imperial College London),
Luitgard A. M. Veraart7
Estimated H-index: 7
(LSE: London School of Economics and Political Science)
We develop a Bayesian methodology for systemic risk assessment in financial networks such as the interbank market. Nodes represent participants in the network and weighted directed edges represent liabilities. Often, for every participant, only the total liabilities and total assets within this network are observable. However, systemic risk assessment needs the individual liabilities. We propose a model for the individual liabilities, which, following a Bayesian approach, we then condition on th...
17 Citations Source Cite
Published on Nov 1, 2017in Reliability Engineering & System Safety 4.14
E.B. Abrahamsen and Terje Aven48
Estimated H-index: 48
(University of Stavanger)
Abstract Current practice for risk characterisations is based on methods reflecting threats, their consequences and probability, as well as concepts like risk factors and sources. The risk matrix is an example of such a method. The risk analysis field has demonstrated that there are many challenges related to this practice and there is a substantial potential for improvements in how the characterisations can be conducted. The key is to better reflect the knowledge aspect of risk. The purpose of ...
13 Citations Source Cite
Published on Feb 1, 2016in Risk Analysis 2.90
E.B. Abrahamsen and Terje Aven48
Estimated H-index: 48
(University of Stavanger),
Louis Anthony Cox8
Estimated H-index: 8
(University of Colorado Denver)
13 Citations Source Cite
Mónica Duarte Oliveira14
Estimated H-index: 14
(IST: Instituto Superior Técnico),
Carlos A. Bana e Costa27
Estimated H-index: 27
(IST: Instituto Superior Técnico),
Diana F. Lopes3
Estimated H-index: 3
(IST: Instituto Superior Técnico)
Risk matrices are adopted and recommended by many organizations, but the way they are usually constructed violates some basic theoretical principles, giving rise to inconsistent risk ratings. This paper studies ways in which multiple criteria and portfolio decision analyses can improve the design and deployment of risk matrices, using MACBETH (the "Measuring Attractiveness by a Categorical Based Evaluation TecHnique"). Firstly, it introduces 'value risk-matrices', built with MACBETH in the follo...
4 Citations Source Cite
Published on Feb 1, 2015in Safety Science 2.83
Ben Ale20
Estimated H-index: 20
(TU Delft: Delft University of Technology),
Peter Burnap17
Estimated H-index: 17
(Cardiff University),
David Slater1
Estimated H-index: 1
(Cardiff University)
The development of parallel ISO "risk" standards series - ISO 31,000 and 27,000 and now Security Risk (28,001) versions, underlines the divergences in requirements from the different currently practising risk management communities. This is highlighted in the content of the series of ongoing web based discussions (Linked in) (Institute of Risk management, 2011). The contributions have been thoughtful, authoritative and illuminating and it is reassuring that even after (or perhaps because of) rec...
20 Citations Source Cite
Published on Jan 1, 2014in International Journal of Project Management 4.33
Abdulmaten Taroun4
Estimated H-index: 4
(University of Bedfordshire)
This paper reviews the literature of construction risk modelling and assessment. It also reviews the real practice of risk assessment. The review resulted in significant results, summarised as follows. There has been a major shift in risk perception from an estimation variance into a project attribute. Although the Probability–Impact risk model is prevailing, substantial efforts are being put to improving it reflecting the increasing complexity of construction projects. The literature lacks a co...
88 Citations Source Cite
Published on Nov 1, 2013in Risk Analysis 2.90
David J. Ball14
Estimated H-index: 14
(Middlesex University),
John Watt18
Estimated H-index: 18
(Middlesex University)
Risk matrices are commonly-encountered devices for rating hazards in numerous areas of risk management. Part of their popularity is predicated on their apparent simplicity and transparency. Recent research, however, has identified serious mathematical defects and inconsistencies. This article further examines the reliability and utility of risk matrices for ranking hazards, specifically in the context of public leisure activities including travel. We find that (a) different risk assessors may as...
28 Citations Source Cite
Cited By4
Newest
Published on Jul 1, 2019in Information Sciences 4.30
Jianping LiXiaolei19
Estimated H-index: 19
(CAS: Chinese Academy of Sciences),
Jin Zhang1
Estimated H-index: 1
(CAS: Chinese Academy of Sciences),
Weilan Suo1
Estimated H-index: 1
(CAS: Chinese Academy of Sciences)
Abstract To promote trade facilitation and regional integration, several cross-border transport infrastructure (CBTI) projects have been implemented and are accompanied by high complexity, difficulty, and uncertainty. This presents a multi-dimensional challenge for risk assessment. However, the challenge is amplified by the presence of dual interdependent effects induced by risk factor cascading propagation and project interaction. The purpose of this study involves developing a fuzzy decision a...
1 Citations Source Cite
Published on Feb 14, 2019
Lili Yuan1
Estimated H-index: 1
(CAS: Chinese Academy of Sciences),
Jianping LiXiaolei19
Estimated H-index: 19
(CAS: Chinese Academy of Sciences)
+ 2 AuthorsDengsheng Wu10
Estimated H-index: 10
(CAS: Chinese Academy of Sciences)
Meta-syntheses from experts’ judgements and quantitative metrics are two main forms of evaluation. But they both have limitations. This paper constructs a framework for mapping the evaluation results between quantitative metrics and experts’ judgements such that they may be solved. In this way, the weights of metrics in quantitative evaluation are objectively obtained, and the validity of the results can be testified. Weighted average percentile (WAP) is employed to aggregate different experts’ ...
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Published on Dec 1, 2018in Knowledge Based Systems 4.40
Xiaoyang Yao (China Jiliang University), Jianping LiXiaolei19
Estimated H-index: 19
(CAS: Chinese Academy of Sciences)
+ 1 AuthorsDengsheng Wu10
Estimated H-index: 10
(CAS: Chinese Academy of Sciences)
Abstract A perfect combination of fact-based and value-based judgments is what multiple criteria decision-making (MCDM) issues pursue. Tolerability constraints, an important part of value-based judgments, are easily observable and have drawn attention in theory. However, their practical applications in the MCDM process are still in their infancy. This paper aims to fill the gap between theory and application. A framework for tolerability constraints in the context of non-independent criteria is ...
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Published on Oct 1, 2018in Information Sciences 4.30
Dengsheng Wu10
Estimated H-index: 10
(CAS: Chinese Academy of Sciences),
Jianping LiXiaolei19
Estimated H-index: 19
(CAS: Chinese Academy of Sciences)
+ 3 AuthorsQianzhi Dai1
Estimated H-index: 1
(Hefei University of Technology)
Abstract Project risk response planning is an important component of project risk management to help ensure project success. However, thus far, the relevant research has ignored the correlations between risk factors during different project development subprocesses. This study proposes a novel risk response method by opening the black box of the project process and considering the risk correlations among different subprocesses to help practitioners create a practical risk response plan. In our m...
2 Citations Source Cite