An invitation to portfolio decision analysis

Abstract

Portfolio Decision Analysis (PDA) – the application of decision analysis to the problem of selecting a subset or portfolio from a large set of alternatives –accounts for a significant share, perhaps the greater part, of decision analysis consulting. PDA has a sound theoretical and methodological basis, and its ability to contribute to better resource allocation decisions has been demonstrated in numerous applications. This book pulls together some of the rich and diverse efforts as a starting point for treating PDA as a promising and distinct area of study and application. In this introductory chapter, we first describe what we mean by PDA. We then sketch the historical development of some key ideas, outline the contributions contained in the chapters and, finally, offer personal perspectives on future work in this sub-field of decision analysis that merits growing attention.