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Balanced Bagging With Expectation Maximization Imputation In Bankruptcy Prediction - Application On Romanian Companies

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  • CLEMENT Claudiu

    (Alexandru Ioan Cuza University of Iasi)

Abstract

Bankruptcy prediction models are widely used by lending institutions, policy makers or investors. Despite the large volume of international research, limited studies have addressed the particularities of Romanian companies. Balanced Bagging is an Ensemble Method that uses a voting mechanism for a classification task. Expectation Maximization Imputation helps replacing the missing data. In this study we report a promising accuracy performance of 90.03% for the model of Balanced Bagging with Expectation Maximization Imputation on a dataset of more than 20,000 Romanian companies.

Suggested Citation

  • CLEMENT Claudiu, 2022. "Balanced Bagging With Expectation Maximization Imputation In Bankruptcy Prediction - Application On Romanian Companies," Revista Economica, Lucian Blaga University of Sibiu, Faculty of Economic Sciences, vol. 74(1), pages 40-50, August.
    • Handle: RePEc:blg:reveco:v:74:y:2022:i:1:p:40-50
    DOI: 10.56043/reveco-2022-0003
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    File URL: http://economice.ulbsibiu.ro/revista.economica/archive/74103clement.pdf
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    References listed on IDEAS

    as
    1. Ohlson, Ja, 1980. "Financial Ratios And The Probabilistic Prediction Of Bankruptcy," Journal of Accounting Research, Wiley Blackwell, vol. 18(1), pages 109-131.
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    More about this item

    Keywords

    bankruptcy; machine learning; classification;
    All these keywords.

    JEL classification:

    • C58 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Financial Econometrics
    • G33 - Financial Economics - - Corporate Finance and Governance - - - Bankruptcy; Liquidation
    • M10 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - General

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