Default Prediction in Pakistan using Financial Ratios and Sector Level Variables
Default prediction provides a way to control and direct firms in achieving their goals. The common approach in this regard has been to study the relationship between set of explanatory variables and financial distress. The study served specific objectives by highlighting the sectors impact on finan...
| Main Authors: | , , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
EconJournals
2016-06-01
|
| Series: | International Journal of Economics and Financial Issues |
| Online Access: | https://www.econjournals.com/index.php/ijefi/article/view/2629 |
| _version_ | 1797918371742744576 |
|---|---|
| author | Suresh Ramakrishnan Agha Amad Nabi Melati Ahmad Anuar |
| author_facet | Suresh Ramakrishnan Agha Amad Nabi Melati Ahmad Anuar |
| author_sort | Suresh Ramakrishnan |
| collection | DOAJ |
| description |
Default prediction provides a way to control and direct firms in achieving their goals. The common approach in this regard has been to study the relationship between set of explanatory variables and financial distress. The study served specific objectives by highlighting the sectors impact on financial behavior of Pakistani listed firms across sectors. The study looks into the sector specific attributes that affect the bankruptcy prediction determinants. Since sectors operate in business environments which are subject to different levels of growth, competiveness and market concentration. The study will investigate the relationship of several independent firm-level, sector level variables that have to be examined with dependent variable. Financial variables nature is not normal so logit used for the nature and also financial distress is binomial variable. In addition, the Company may provide the possibility of financial distress and indicates an argument that this study used independent variables that are best predictors of financial distress.
Keywords: Financial Distress, Financial Ratio, Sector level variables
JEL Classifications: E24, G23
|
| first_indexed | 2024-04-10T13:28:01Z |
| format | Article |
| id | doaj.art-79fdd4edc8f84262b5548f8fac4c8cee |
| institution | Directory Open Access Journal |
| issn | 2146-4138 |
| language | English |
| last_indexed | 2024-04-10T13:28:01Z |
| publishDate | 2016-06-01 |
| publisher | EconJournals |
| record_format | Article |
| series | International Journal of Economics and Financial Issues |
| spelling | doaj.art-79fdd4edc8f84262b5548f8fac4c8cee2023-02-15T16:11:47ZengEconJournalsInternational Journal of Economics and Financial Issues2146-41382016-06-0163SDefault Prediction in Pakistan using Financial Ratios and Sector Level VariablesSuresh RamakrishnanAgha Amad NabiMelati Ahmad Anuar Default prediction provides a way to control and direct firms in achieving their goals. The common approach in this regard has been to study the relationship between set of explanatory variables and financial distress. The study served specific objectives by highlighting the sectors impact on financial behavior of Pakistani listed firms across sectors. The study looks into the sector specific attributes that affect the bankruptcy prediction determinants. Since sectors operate in business environments which are subject to different levels of growth, competiveness and market concentration. The study will investigate the relationship of several independent firm-level, sector level variables that have to be examined with dependent variable. Financial variables nature is not normal so logit used for the nature and also financial distress is binomial variable. In addition, the Company may provide the possibility of financial distress and indicates an argument that this study used independent variables that are best predictors of financial distress. Keywords: Financial Distress, Financial Ratio, Sector level variables JEL Classifications: E24, G23 https://www.econjournals.com/index.php/ijefi/article/view/2629 |
| spellingShingle | Suresh Ramakrishnan Agha Amad Nabi Melati Ahmad Anuar Default Prediction in Pakistan using Financial Ratios and Sector Level Variables International Journal of Economics and Financial Issues |
| title | Default Prediction in Pakistan using Financial Ratios and Sector Level Variables |
| title_full | Default Prediction in Pakistan using Financial Ratios and Sector Level Variables |
| title_fullStr | Default Prediction in Pakistan using Financial Ratios and Sector Level Variables |
| title_full_unstemmed | Default Prediction in Pakistan using Financial Ratios and Sector Level Variables |
| title_short | Default Prediction in Pakistan using Financial Ratios and Sector Level Variables |
| title_sort | default prediction in pakistan using financial ratios and sector level variables |
| url | https://www.econjournals.com/index.php/ijefi/article/view/2629 |
| work_keys_str_mv | AT sureshramakrishnan defaultpredictioninpakistanusingfinancialratiosandsectorlevelvariables AT aghaamadnabi defaultpredictioninpakistanusingfinancialratiosandsectorlevelvariables AT melatiahmadanuar defaultpredictioninpakistanusingfinancialratiosandsectorlevelvariables |