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Determining the Financial Failure in Enterprises Using Grey Relational Analysis and Logistic Regression Analysis & an Application


  • Metin Bas
  • Zeki Cakmak

    () (Dumlupinar University
    Dumlupinar University)


Grey relational analysis can be used as a rating, classification and decision making technique to determine the important factors among those required for a system with a limited amount of data set. For this purpose, by making use of the relations between the financial rates used as independent variable in forecasting financial failure, it was tried to determine the fewer number of financial rates that determine the financial characteristics of enterprises best using grey relational analysis. As a result of using the independent variables determined through grey relational analysis as independent variables in logistic regression analysis for classification, it was aimed to develop a model with a high correct classification percentage, and thus, to decide upon the best model for increasing success.

Suggested Citation

  • Metin Bas & Zeki Cakmak, 2012. "Determining the Financial Failure in Enterprises Using Grey Relational Analysis and Logistic Regression Analysis & an Application," Anadolu University Journal of Social Sciences, Anadolu University, vol. 12(3), pages 63-82, September.
  • Handle: RePEc:and:journl:v:12:y:2012:i:3:p:63-82

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    References listed on IDEAS

    1. Masako Ueda, 2004. "Banks versus Venture Capital: Project Evaluation, Screening, and Expropriation," Journal of Finance, American Finance Association, vol. 59(2), pages 601-621, April.
    2. Black, Bernard S. & Gilson, Ronald J., 1998. "Venture capital and the structure of capital markets: banks versus stock markets," Journal of Financial Economics, Elsevier, vol. 47(3), pages 243-277, March.
    3. van Pottelsberghe de la Potterie, Bruno & Romain, Astrid, 2004. "The Determinants of Venture Capital: Additional Evidence," Discussion Paper Series 1: Economic Studies 2004,19, Deutsche Bundesbank.
    4. Schertler, Andrea, 2003. "Driving Forces of Venture Capital Investments in Europe: A Dynamic Panel Data Analysis," Kiel Working Papers 1172, Kiel Institute for the World Economy (IfW).
    5. Andrea Schertler, 2007. "Knowledge Capital and Venture Capital Investments: New Evidence from European Panel Data," German Economic Review, Verein für Socialpolitik, vol. 8, pages 64-88, January.
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    More about this item


    Grey Relational Analysis; Logistic Regression; Financial Failure.;

    JEL classification:

    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
    • C38 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Classification Methdos; Cluster Analysis; Principal Components; Factor Analysis
    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods


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