AHP Cost-Benefit Analysis is Justifiable

Abstract

Several researchers think that the AHP Cost-Benefit Analysis method may give rise to misleading results in some situations. Hence they propose four alternative methods: (1) the aggregate $ method, (2) the cost-benefit ratio method, (3) the difference method and (4) the sum method. However, careful mathematical analysis, backed by numerical examples, show that the aggregate $ method and the cost-benefit ratio method imply nothing but the same results yielded by Saaty’s original method (1994). More worrisome, we also show that the difference method and the sum method cause rank order reversal problems under some conditions.

Keywords

• Analytic hierarchy process
• Cost-benefit analysis