Subjective Probability and Its Measurement

SUMMARY Subjective probability is defined and its place in decision analysis, with special reference to business problems, is identified. The literature on its measurement is critically analysed both for the single decision-maker and group. The use of direct fractile assessment and the Delphi Technique are felt to be some of the more tenable of the methods reviewed. An account of some of the behavioural aspects of decision-making with a resume of the risky shift theories is included and their implications are discussed. Some practical guidelines and suggestions for further research are indicated.