MRP-PCI: A Multiple Reference Point Based Partially Compensatory Composite Indicator for Sustainability Assessment

Francisco Ruiz and José Manuel Cabello
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Francisco Ruiz: Department of Applied Economics (Mathematics), University of Málaga, Calle Ejido, 6, 29071 Málaga, Spain
José Manuel Cabello: Department of Applied Economics (Mathematics), University of Málaga, Calle Ejido, 6, 29071 Málaga, Spain

Sustainability, 2021, vol. 13, issue 3, 1-19

Abstract: Assessing different types of sustainability is a complex procedure, which implies considering aspects of very different nature. One way to do this is using a system of single indicators measuring all these different aspects and aggregating them in an overall composite indicator. In line with the concepts of weak and strong sustainability, the compensability degree among the indicators allowed by the aggregation procedure is a crucial issue. There exist methods that allow for full compensability, zero compensability, or partial compensability. In most of them, the compensation degree is established in a global way, that is, it is the same for all the indicators. In this paper, we develop the Multiple Reference Point Partially Compensatory Indicator (MRP-PCI), where a different compensation index can be established for each indicator. The resulting method can be applied to any system of indicators, and successfully considers the compensation indices given. Some examples and comparisons are used to illustrate its behavior.

Keywords: sustainability; composite indicators; partial compensation; multiple reference point methodology; multiple criteria decision making (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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