Probabilistic Linguistic Matrix Game Based on Fuzzy Envelope and Prospect Theory with Its Application

Shuying Li and Guoping Tu
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Shuying Li: School of Public Policy and Administration, Nanchang University, Nanchang 330031, China
Guoping Tu: School of Public Policy and Administration, Nanchang University, Nanchang 330031, China

Mathematics, 2022, vol. 10, issue 7, 1-30

Abstract: Game theory is a powerful tool in modeling strategic interaction among rational players. However, as practical problems become more complex, uncertainty inevitably appears in the game. Due to the advantages of probabilistic linguistic term sets (PLTSs) in comprehensively and flexibly portraying uncertainty, fuzziness and hesitancy, this paper uses PLTSs to express players’ payoff values, and aims to develop an integrated method based on fuzzy envelope and prospect theory (PT) under a probabilistic linguistic environment for solving matrix games. In this method, an improved probabilistic ordered weighted averaging (POWA) operator is defined. Then, a novel trapezoidal fuzzy envelope for PLTSs is proposed and some related theorems are analyzed. Next, based on the defined cosine distance measure for PLTSs, the players’ psychological behavior in the game is considered by establishing the prospect value function. Besides, the applicability and practicability of the proposed method is verified with an example from the development strategy of Sanjiangyuan National Nature Reserve (SNNR) in China. Finally, some comparative analyses are carried out to illustrate the superiority of the proposed method. In order to improve the application of this proposed method, a decision support system (DSS) based on it is designed.

Keywords: probabilistic linguistic term sets; trapezoidal fuzzy envelope; prospect theory; matrix game; decision support system (search for similar items in EconPapers)
JEL-codes: C (search for similar items in EconPapers)
Date: 2022
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