Fuzzy Logic and Its Uses in Finance: A Systematic Review Exploring Its Potential to Deal with Banking Crises

Marc Sanchez-Roger, María Dolores Oliver-Alfonso and Carlos Sanchís-Pedregosa
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Marc Sanchez-Roger: Faculty of Economics and Business, Universidad de Sevilla, Avd. Ramón y Cajal, 1, 41018 Sevilla, Spain
María Dolores Oliver-Alfonso: Faculty of Economics and Business, Universidad de Sevilla, Avd. Ramón y Cajal, 1, 41018 Sevilla, Spain
Carlos Sanchís-Pedregosa: Faculty of Economics and Business, Universidad de Sevilla, Avd. Ramón y Cajal, 1, 41018 Sevilla, Spain

Mathematics, 2019, vol. 7, issue 11, 1-22

Abstract: The major success of fuzzy logic in the field of remote control opened the door to its application in many other fields, including finance. However, there has not been an updated and comprehensive literature review on the uses of fuzzy logic in the financial field. For that reason, this study attempts to critically examine fuzzy logic as an effective, useful method to be applied to financial research and, particularly, to the management of banking crises. The data sources were Web of Science and Scopus, followed by an assessment of the records according to pre-established criteria and an arrangement of the information in two main axes: financial markets and corporate finance. A major finding of this analysis is that fuzzy logic has not yet been used to address banking crises or as an alternative to ensure the resolvability of banks while minimizing the impact on the real economy. Therefore, we consider this article relevant for supervisory and regulatory bodies, as well as for banks and academic researchers, since it opens the door to several new research axes on banking crisis analyses using artificial intelligence techniques.

Keywords: fuzzy logic; finance; banking; banking crisis management (search for similar items in EconPapers)
JEL-codes: C (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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