Having studied the chapters 4 and 5 of the given book, written by Malmnäs and Paulsson, we understood that among common theories, which represent approaches to decisions under uncertainty there are various concepts that reflect the author’s personal attitude to the above-mentioned problem.
Thus, the chapters disclose the concepts of the following authors: Hodges and Lehmann, Blum and Rosenblatt, Watson, Levi, Gärdenfors and Sahlin as well as the rules for evaluation and choice.
To start with, the fourth chapter deals with the issue of evaluating the decision rules when two or more probabilities being presented. The authors undertake the attempt to look upon different theories including the theories concerned with Statistical Decision Theory and some others, which are rather close to it.
Thus, while examining the proposed theories we are inclined to think that the theory presented by Hodges and Lehmann is based on optional choice, which is the most preferable among others. Moreover, the authors emphasize that one of the component of the proposed formulae is a lottery. Such theory can be applied, while studying the consumer’s choice for that or this product. Still, to our way of thinking this theory can provide only data for statistics, the real data can’t be received with the help of this theory. Under real data, we understand the real decision of the customer to purchase that or this product. Nevertheless considering uncertainty as a lottery is rather strange and odd. The category of uncertainty is connected to the psychological sphere and the roots of it should be search there. For example the theories of Kornilova (2008), Zinchenko (2007), Ball (2009) and others advocate the idea that the uncertainty is bound to the field of behavior and choice regulation by explicitly including and operationalizing the domain of personality.
The second theory presented by Blum and Rosenblatt in some way coincides with the theory presented by Hodges and Lehmann. Blum and Rosenblatt are inclined to think that a selection of options is to be based on the most preferable choice and its evaluation. Such theory can be applied as well to economic and management spheres. It can be at a hand, for example in the process of decision making, while studying the way of product promotion. Still, while making a decision every consumer has his own way of thinking and whether the promotion of goods helps them to overcome uncertainty can’t be presented with the help of formula. To our way of thinking, only testing conducted in target groups can support the data received with the help of this theory.
The third theory presented by Watson has some additional information that is what should, for example directors of the firm do in case of wrong decision or choice. Therefore, the rationale behind Watson’s proposal is that the managing staff should minimize the damage due to a choice based on a wrong solution. Still, we are sure that such concept will help managers to avoid damages in the process of decision-making. To our way of thinking such theory wouldn’t be at hand in case of managers who are so called “individual makers”. Under this term, we mean a single taking manager who is centered over his own career and has no desire to take part and to share the “honor” with others. We reckon that in this case Watson, the author of the theory, has put aside the so-called “human factor”, which can be a “stumbling block” in the process of decision-making. Moreover, we associate “human factor” with individual abilities and inclinations of the manager.
The forth theory presented by Levi does not propose an evaluation or ranking of available options in a satisfiable decision frame but instead it proposes ways of delimiting the set of permissible options. This very theory will be useful in the process of team building in the firm, when all staff is proposed to present own understanding of the problem. From the other hand customer won’t delimit the set of permissible options in case of purchasing essential commodities. He or she would rather use the habit of buying that is purchasing of the goods to which his or her family used. Nevertheless, while buying luxury items, that is cars, houses or TV sets the long process of family decision-making will be conducted and the proposed theory would be rather useful.