Theoretical and Applied Economics
No. 5 / 2013 (582)
Early warning models of financial distress. Case study of the Romanian firms listed on RASDAQ
The Bucharest University of Economic Studies
Abstract. In this paper we design an early warning model for Romanian distressed firms. The logit model was built based on financial ratios of 66 Romanian firms listed on RASDAQ that were facing financial difficulties in 2011. In addition, we identified the main principal components obtained with minimum loss of information after applying the principal component analysis and proposed a new estimation of the logit model by replacing the initial set of input data matrix with the main principal components of the financial observations. The results indicated an increase with 12 percentage points in the performance of the one year ahead prediction of financial distress of the new warning model.
Keywords: distress prediction; financial crisis; logit model; principal component analysis.
Contents
- Early warning models of financial distress. Case study of the Romanian firms listed on RASDAQ
Mădălina Ecaterina ANDREICA
- Innovation: a path to competitiveness
and economic growth.
The case of CEE countries
Ioan Radu PETRARIU
Robert BUMBAC
Radu CIOBANU
- Education for sustainability – a prerequisite
for post-crisis economic competitiveness
with possible inference for Romania
Camelia Iuliana LUNGU
Chirața CARAIANI
Cornelia DASCĂLU
- A regional model for labour demand
in Romania
Paul Costel ROTARU
- Robustness of public choice
models of voting behavior
Mihai UNGUREANU
- The evolution of sovereign wealth funds and their
influence in the global economy.
The case of China
Ioana-Iulica MIHAI
- The customers borrowing behavior
during the financial crisis
Alina LUCA (BRĂTUCU)
- Foreign direct investment and economic growth
in Romania
Camelia MORARU
- The image of the economic institutions
in the context of global economy
Laurențiu Gabriel FRÂNCU