Parameterized analysis of the choice between do-nothing and act-now options

An alternative parameterization is presented for analyzing the choice between an act-now option and a do-nothing option. The approach assumes only two outcomes are possible, and only one decision criterion is used. The problem is described in terms of a set of six independent, dimensionless parameters, and one cost scale parameter. The best choice is given as an equation in terms of the six parameters for both a decision-maker who maximizes expected value and for one who maximizes utility. The analysis highlights the sensitivity of the decision to a new parameter, the benefit-of-abatement multiplier, which is the fraction of the costs spent now that can be deducted from future costs when following an act-now choice. This parameterization could lead to a greater understanding of the important characteristics of the problem, and facilitate transferability of results between analyses. It could help systems analysts either in formulating decisions, or in post-hoc evaluations of historic decisions.