Using Electre to analyze the behaviour of economic agents.

According to behavioural finance, economic agents display cognitive bias, heuristics and emotional factors that generate
preferences which systematically violate the rationality assumptions of the normative model of classical decision theory.
Rather than maximizing the expected utility, representing the optimal choice, they attempt to accept a satisfactory solution.
Morton and Fasolo (J Oper Res Soc 60:268–275, 2009) outlined some behavioural findings relevant to the practice of
multicriteria approach. In this paper, we propose a multicriteria model for analysing some experiments proposed by
Kahneman and Tversky (Econometrica 47:263–29 l, 1979). Our aim is to verify whether a multicriteria tool reduces or
minimizes cognitive biases. We focus on ELECTRE due to its main features: it accepts the violation of some mathematical
axioms. By a simulation study, we represent a set of prospects by means of decision matrices: the prospects are considered
as alternatives, the events as criteria, the probabilities of events as the weights assigned to criteria. Then, we apply
ELECTRE to verify whether the preference ranking among the alternatives confirms the results obtained by Kahneman–
Tversky, that is, whether it is able to describe the emotional behaviours of economic agents.