Firm bankruptcy prediction: Experimental comparison of isotonic separation and other classification approaches

Young U. Ryu, Wei T. Yue

Research output: Journal Publications and ReviewsRGC 22 - Publication in policy or professional journal

42 Citations (Scopus)

Abstract

A newly introduced method called isotonic separation is evaluated in the prediction of firm bankruptcy. Feature reduction methods are first applied to reduce the ratios used in the prediction. Then, various classification methods, including discriminant analysis, neural networks, decision tree induction, learning vector quantization, rough sets, and isotonic separation, are used with the reduced ratios. Experiments show that the isotonic separation method is a viable technique, performing generally better than other methods for short-term bankruptcy prediction. © 2005 IEEE.
Original languageEnglish
Pages (from-to)727-737
JournalIEEE Transactions on Systems, Man, and Cybernetics Part A: Systems and Humans
Volume35
Issue number5
DOIs
Publication statusPublished - Sept 2005
Externally publishedYes

Research Keywords

  • Bankruptcy prediction
  • Isotonic separation
  • Pattern classification
  • Prediction method

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