Methodological shifts in ratio-based modelling of corporate collapse

Methodological shifts in ratio-based modelling of corporate collapse

Hossari, Ghassan 2005, Methodological shifts in ratio-based modelling of corporate collapse, Australasian journal of business and behavioural sciences, vol. 1, no. 2, pp. 101-115.

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Title	Methodological shifts in ratio-based modelling of corporate collapse
Author(s)	Hossari, Ghassan
Journal name	Australasian journal of business and behavioural sciences
Volume number	1
Issue number	2
Start page	101
End page	115
Publisher	Australasian Business and Behavioural Sciences Association
Place of publication	Townsville, Qld.
Publication date	2005
ISSN	1832-0422
Keyword(s)	corporate collapse multiple discriminant analysis (MDA) financial ratios corporate failure logit analysis neural network analysis probit analysis rough sets analysis recursive partitioning algorithm ID3 decomposition analysis going concern advisor Koundinya and Puri judgmental approach tabu search mixed logit analysis
Summary	The year 1968 saw a major shift from univariate to multivariate methodological approaches to ratio-based modelling of corporate collapse. This was facilitated by the introduction of a new statistical tool called Multiple Discriminant Analysis (MDA). However, it did not take long before other statistical tools were developed. The primary objective for developing these tools was to enable deriving models that would at least do as good a job asMDA, but rely on fewer assumptions. With the introduction of new statistical tools, researchers became pre-occupied with testing them in signalling collapse. lLTUong the ratio-based approaches were Logit analysis, Neural Network analysis, Probit analysis, ID3, Recursive Partitioning Algorithm, Rough Sets analysis, Decomposition analysis, Going Concern Advisor, Koundinya and Purl judgmental approach, Tabu Search and Mixed Logit analysis. Regardless of which methodological approach was chosen, most were compared to MDA. This paper reviews these various approaches. Emphasis is placed on how they fared against MDA in signalling corporate collapse.
Language	eng
Field of Research	150201 Finance
HERDC Research category	C1 Refereed article in a scholarly journal
Copyright notice	©2005, Australasian Business and Behavioural Sciences Association
Persistent URL	http://hdl.handle.net/10536/DRO/DU:30003468

Document type:	Journal Article
Collection:	Deakin Graduate School of Business

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