Bankruptcy Prediction: A Survey on Evolution, Critiques, and Solutions
5. Conclusions
The present paper summarizes the short evolution of bankruptcy prediction and the main critiques made on modelling and prediction of bankruptcy, as well as it summarizes the future research avenues recommended in these studies . The critiques are based on three important survey papers, namely Balcaen and Ooghe (2004), Bellovary et al . (2007), and Kirkos (2015), where the latter is a review of the most important papers in artificial intelligence and theoretical approaches.
A final conclusion can be made that, based on the reviewed papers, bankruptcy prediction still has new, unconquered fields because of the diversity of business culture (see Xu & Zhang, 2009), on the one hand, and due to its complexity, on the other hand, there is an area that has not been properly explored . The knowledge on managerial behaviour can be used in bankruptcy predictability .
Another possible avenue for future research is to statistically classify the different models by their inputs (number of ratios used, type of ratios used, cultural characteristics, models used, industry type, macroeconomic factors, and other relevant independent variables taken from the models) and use the accuracy of that model as a dependent variable . We believe that this way it is possible to obtain further information on why some models are better than others .
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