A random utility model on economics and critical decision points in clinical practice

Decision-making is an activity that everyone makes it at every moment of life. If there is more than one criteria in the decision-making process in question, this is a Multi-Criteria Decision Making (MCDM) problem. Numerous methods have been developed to solve MCDM problems since the beginning of seventies. Various methods are available for achieving the best solution in the MCDM problems. Different methods could propose different solutions. To find which method provides the best solution for the problem, it come across as a new problem in itself. In this study, the regression approach has been proposed as a new framework for selection the best MCDM method for given problem. The proposed approach is built upon the relationship between the decision matrix and preference ranking. The most of MCDM methods make an order of preference among the alternatives by using the decision matrix. The relationship between decision matrix and preference ranking can be demonstrated by the regression model. The goodness of fit of the regression model, reflects the quality of the ranking. The coefficient of determination is a useful tool to measure the goodness of fit. The MCDM method used in the model which obtained the highest coefficient of determination is the best method. The financial performance analysis of 25 real estate investment trust firms that traded in Borsa İstanbul is evaluated as application. The TOPSIS, MAUT, CP, PROMETHEE and VIKOR methods are selected as MCDM methods. Entropy method is preferred for criteria weighting. The proposed regression approach presents an opportunity of exact and objective analysis among the MCDM methods. In addition, since regression approach consists of basic mathematical and statistical tools it is very useful. Therefore the proposed approach is expected to make a significant contribution to the literature.