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EOR
2007

Modelling profitability using survival combination scores

10 years 2 months ago
Modelling profitability using survival combination scores
The paper presents the first empirical investigation of the relationship between present value of net revenue from a revolving credit account and times to default and to second purchase. The analysis is based on the data for a store card which is used to buy ‘white’ durable goods in Germany. It is demonstrated that there exists a relationship between the above given measures. It appears that there is a scope for improving profit if an application for a store card is assessed by using a model which estimates the revenue and includes the survival probability of default and the survival probability of second purchase (a survival combination model) rather than merely a static probability of default predicted by a logistic regression.
Galina Andreeva, Jake Ansell, Jonathan Crook
Added 14 Dec 2010
Updated 14 Dec 2010
Type Journal
Year 2007
Where EOR
Authors Galina Andreeva, Jake Ansell, Jonathan Crook
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