Examining Statistical Methods in Forecasting Financial Energy of Households in Poland and Taiwan

Tomasz Korol
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Tomasz Korol: Faculty of Management and Economics, Gdansk University of Technology, Narutowicza 11/12, 80-233 Gdansk, Poland

Energies, 2021, vol. 14, issue 7, 1-14

Abstract: This paper examines the usefulness of statistical methods in forecasting the financial energy of households. The study’s objective is to create the innovative ratios that combine both financial and demographic information of households and implement them in the forecasting models. To conduct this objective, six forecasting models are developed using three different methods—discriminant analysis, logit analysis, and decision trees separately for households in Poland and Taiwan. Such a research approach will answer the question whether the implementation of constructed ratios can increase effectiveness of the forecasting model and its’ versatility between different economic regions. The research relies on four samples of households—two learning samples and two testing samples (one for each country) consisting of 2400 households from both countries. This study is one of the first attempts in the literature globally to develop forecasting models based on ratios constructed with a combination of two different types of variables—one financial with one demographic variable. Findings confirm the high usability of the proposed innovative approach for forecasting the financial energy of households by taking into account a wide spectrum of diagnostic variables representing the financial strength of consumers.

Keywords: economics of family; finance; financial energy; forecasting; bankruptcy of the household; financial health; insolvency of consumers; decision-making; Polish households; Taiwanese households (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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