Giuseppe Munda

Social multi-criteria evaluation: Methodological foundations and operational consequences

In order to address contemporary issues economics and decision sciences need to expand their empirical relevance by introducing more and more realistic (thus more complex) assumptions in their models. One of the most interesting research directions in the field of public economics is the attempt to introduce political constraints, interest groups and collusion effects explicitly (J.J. Laffont, Incentives and Political Economy, 2000). The main argument developed here is the proposal of the concept of social multi-criteria evaluation (SMCE) as a possible useful framework for the application of social choice to the difficult policy problems of our millennium, where, as stated by Funtowicz and Ravetz, “facts are uncertain, values in dispute, stakes high and decisions urgent”. This paper starts from the following main questions: 1. Why “social” multi-criteria evaluation? 2. How should such an approach be developed? The foundations of SMCE are set up by referring to concepts from complex system theory and philosophy, such as reflexive complexity, post-normal science and incommensurability. To give some operational guidelines on the application of SMCE basic questions to be answered are 1. How is it possible to deal with technical incommensurability? 2. How can we deal with the issue of social incommensurability? To answer these questions, using theoretical considerations and lessons learned from real-world case studies, is the main objective of the present article.

Weak comparability of values as a foundation for ecological economics

The main argument of this paper is that weak comparability of values should be seen as one characteristic feature of ecological economics. The formal properties of the concepts of strong comparability (implying strong or weak commensurability) and weak comparability (implying incommensurability) will be clarified. Multicriteria evaluation offers the methodological and mathematical tools to operationalize the concept of incommensurability at both macro and micro levels of analysis. The concept of incommensurability of values already has a long tradition in economics; moreover, we will show that analytic philosophy, theories of complexity, post-normal science and the recent theories of rationality lead with different trajectories to a non-algorithmic approach which, in our view, could be implemented by some forms of multicriteria evaluation.

Qualitative multicriteria evaluation for environmental management

One of the main differences among evaluation models is between monetary and non-monetary evaluation. Cost-benefit analysis and cost-effectiveness analysis are well-known examples of a monetary evaluation. In the past decades the degraded state of the natural environment has become a key issue, and it is increasingly taken for granted that environmental and resource problems generally have far-reaching economic and ecological consequences. Economic-environmental evaluation and decision problems are conflictual in nature and, therefore, multicriteria techniques seem to be an appropriate modelling tool. This paper attempts to analyse in a critical way some essential aspects of multicriteria decision methods. In particular, the paper deals with uncertainty and measurement problems in environmental policy analysis, seen from the viewpoint of the measurement level of information (including fuzzy set methods). Particular emphasis will be placed on methods for concerted planning evaluation.

Alternative models of individual behaviour and implications for environmental policy

Abstract Most insights of environmental economics are in line with the standard neoclassical economic model of rational behaviour, formulated in terms of maximization of utility in general, or of profits in particular. The standard theory of environmental policy is a case in point. However, the maximization hypothesis and its methodological foundation have been criticized on many grounds related to a lack of either logical or empirical content. Moreover, over the years a great many alternative models of behaviour have been proposed. Both criticism and alternatives are surveyed here. Attention is devoted to relevant insights from the philosophy of science, the notion of methodological individualism, and other criticism. The alternative behavioural models include bounded rationality and ‘satisficing’, lexicographic preferences, habitual behaviour, incommensurability and multicriteria evaluation, and various models of behaviour under uncertainty. Major implications of the criticism and alternative models of individual behaviour for environmental policy theory are outlined.

Combining participative and institutional approaches with multicriteria evaluation. An empirical study for water issues in Troina, Sicily

Abstract The policy problem addressed in this article is the perceived under-exploitation of the potential availability of water resources in the town of Troina (a municipality of eastern Sicily, Italy). In order to help the local town administration, which raised this issue, a trans-disciplinary research team was formed with the purpose of testing some explanatory hypotheses and to provide possible alternatives for action. The research design and process consisted of the following steps, (1) a multicriteria evaluation used as a learning tool to understand the main structure of the problem at hand and to explore its qualitative dimensions; (2) analysis of the structure of power interests and stakeholders (ranging from local to regional social actors) by means of an institutional analysis; (3) field research involving in-depth interviews with key actors, and a survey of local residents.This approach has proven very effective for finding out whether some real social compromise solutions exist.

Environmental Economics, Ecological Economics, and the Concept of Sustainable Development

This paper presents a systematic discussion, mainly for non-economists, on economic approaches to the concept of sustainable development. As a first step, the concept of sustainability is extensively discussed. As a second step, the argument that it is not possible to consider sustainability only from an economic or ecological point of view is defended; issues such as economic-ecological integration, inter-generational and intra-generational equity are considered of fundamental importance. Two different economic approaches to environmental issues, i.e. neo-classical environmental economics and ecological economics, are compared. Some key differences such as weak versus strong sustainability, commensurability versus incommensurability and ethical neutrality versus different values acceptance are pointed out.

Cost-benefit analysis in integrated environmental assessment: some methodological issues

Abstract A fundamental step in integrated environmental assessment (IEA) is the choice of an assessment framework. The usual attempt to develop integrated assessments of different options is to apply a cost-benefit analysis (CBA), which is an important part of the IEA, but at the same time is one of its weakest points. One should note that this paper does not aim at presenting new advances on specific issues of CBA. The present paper has as a main objective to analyse the role of CBA in the IEA framework, in particular: (1) to make explicit the economical, philosophical and mathematical assumptions on which CBA is based; (2) to discuss the main characteristics and consequences of these assumptions; (3) to test the consistency and compatibility of such an axiomatic system. It is thought that this is useful above all for non-economists involved in IEA studies.

Qualitative multicriteria methods for fuzzy evaluation problems: An illustration of economic-ecological evaluation

Abstract It is nowadays increasingly realised that environmental and resource problems generally have complicated economic and ecological dimensions. Therefore, there is a clear need for models offering a comprehensible and operational representation of a real-world environmental system. A great variety of quantitative (descriptive and forecasting) models has been developed for compound environmental systems, but there is still a need in a planning context for evaluation methods taking into account information of a mixed (qualitative and quantitative) type. This paper presents a new discrete multicriteria evaluation model whose impact (or evaluation) matrix may include either crisp, stochastic or fuzzy measurements of the performance of an alternative an with respect to a criterion gm. No traditional weighting of criteria is used in this method. From an empirical point of view, this model is particularly suitable for economic-ecological modelling incorporating various degrees of precision of the variables measured. From a methodological point of view, two main issues will be faced here: (i) the problem of equivalence of the used procedures in order to standardise the various evaluations (of a mixed type) of the performance of alternatives according to different criteria; (ii) the problem of comparison of fuzzy numbers typical of all fuzzy multicriteria methods. An illustrative numerical example will be presented at the end of the paper.

A conflict analysis approach for illuminating distributional issues in sustainability policy

In the area of environmental and resource management and in policies aiming at sustainable development, conflicting issues and interests are the normal state of affairs. Mathematical approaches cannot of course be a panacea able to resolve all real-world conflicts; but they can help to provide more insight into the nature of these conflicts by providing systematic information. Moreover mathematical models are very useful in helping at finding potential social compromises by making a complex situation more transparent to policy-makers and lay people. This is the main objective of the conflict analysis procedure developed here. Distributional issues are taken into consideration by means of an eclectic approach using concepts from land-use planning, fuzzy cluster analysis and social choice. All the various properties presented by the proposed approach are made explicit thus allowing its evaluation on theoretical and empirical grounds. Possible relationships of complementarity or conflictuality with other existing approaches are also discussed briefly. A real-world illustrative example is presented too.

A NAIADE based approach for sustainability benchmarking

Sustainability management and planning is mainly a social decision process about the desired future of a given city, region or country. A possible reduction of the unavoidable complexity, present in this type of problems, consists in considering explicitly non-equivalent representations which arise in the interaction between the various observer subjects and the different systemic levels considered. The reduction of the number of non-equivalent representations leads us to the use of descriptors such as indicators and indexes. Then a question arises: how could such indicators be used for policy making? This paper presents a multicriteria framework, aimed at helping real-world policy processes, for the benchmarking of sustainability indicators.