A Global Model for Bankruptcy Prediction

David Alaminos, Agustín del Castillo and Manuel Ángel Fernández

PLOS ONE, 2016, vol. 11, issue 11, 1-18

Abstract: The recent world financial crisis has increased the number of bankruptcies in numerous countries and has resulted in a new area of research which responds to the need to predict this phenomenon, not only at the level of individual countries, but also at a global level, offering explanations of the common characteristics shared by the affected companies. Nevertheless, few studies focus on the prediction of bankruptcies globally. In order to compensate for this lack of empirical literature, this study has used a methodological framework of logistic regression to construct predictive bankruptcy models for Asia, Europe and America, and other global models for the whole world. The objective is to construct a global model with a high capacity for predicting bankruptcy in any region of the world. The results obtained have allowed us to confirm the superiority of the global model in comparison to regional models over periods of up to three years prior to bankruptcy.

Date: 2016
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Persistent link: https://EconPapers.repec.org/RePEc:plo:pone00:0166693

DOI: 10.1371/journal.pone.0166693

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