Financial Performance in Manufacturing Firms: A Comparison Between Parametric and Non-Parametric Approaches

Eleonora Bartoloni and Maurizio Baussola ()

Business Economics, 2014, vol. 49, issue 1, 32-45

Abstract: This paper provides a methodological analysis of credit risk in manufacturing firms by using two different credit scoring approaches. The first is the traditional discriminant approach for bankruptcy prediction based on a logistic regression model, whereas the second, data envelopment analysis, is a nonparametric approach for measuring firms’ efficiency that does not require ex-ante information on bankrupted firms. By using a manufacturing sample of both healthy and bankrupted firms during the period 2003–09 we provide an in-depth comparison of discriminant analysis and data envelopment analysis and conclude that a correct evaluation of firms’ credit worthiness is the result of successive fine-tuning procedures requiring the use of multiple methodological tools.

Date: 2014
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.palgrave-journals.com/be/journal/v49/n1/pdf/be201331a.pdf Link to full text PDF (application/pdf)
http://www.palgrave-journals.com/be/journal/v49/n1/full/be201331a.html Link to full text HTML (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Financial performance in manufacturing firms: a comparison between parametric and non parametric approaches (2012)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:buseco:v:49:y:2014:i:1:p:32-45

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/11369

Access Statistics for this article

Business Economics is currently edited by Charles Steindel

More articles in Business Economics from Palgrave Macmillan, National Association for Business Economics Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().