Determining the appropriate weights of criteria in multi-criteria decision-making using cooperative game: A case study of bank

Subject Areas : Financial Engineering

Seyed Hadi Mousavi-Nasab ¹ , Jalal Safari ² , Ashkan Hafezalkotob ³

1 - Department of Industrial Engineering, Science and Research Branch ,Islamic Azad University, Tehran, Iran
2 - Department of Industrial Engineering, Karaj Branch, Islamic Azad University, Karaj, Iran
3 - College of Industrial engineering, South Tehran Branch, Islamic Azad University, Tehran, Iran

Received: 2022-01-01 Accepted : 2022-04-24 Published : 2023-07-01

Keywords: TOPSIS, Data encelopment analysis, Shannon Entropy, Shapley value,

Abstract :

Criteria weighting is a crucial step in the entire decision-making process. Determining the appropriate weights will lead to more reliable results. This study aims to use a coalitional game method for calculating proper criteria weights in multi-criteria decision-making (MCDM). In this paper, the Shapley value method is used to determine the weight of criteria. A numerical case study of 65 banks has been used to explain the efficiency of the proposed method. To this end, using the TOPSIS technique, the alternatives are ranked once in Shapley value and again in the Shannon entropy weighted matrix. Then the results are obtained applying Spearman rank correlation coefficient are compared to efficiency-based ranking using data envelopment analysis (DEA) as a powerful benchmarking method. In the proposed method, unlike many conventional weighting methods, the selection of criteria weights is made in a coalitional game with the participation of all criteria; the obtained weights are both intuitively and objectively fairer, and more reliable rankings are provided. According to the logical and fair calculation of weights, having a simple and understandable mathematical method, and no need for experts’ judgment, the proposed method can be used in real problems. Especially where realistic ranking has a significant impact on the equitable allocation and absorption of resources.

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