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on Discrete Choice Models |
| By: | Maria J. Ruiz Martos (Department of Economic Theory and Economic History, University of Granada.) |
| Abstract: | Cubitt, Starmer and Sugden [TheEconomic Journal, 108, 1362-80, (1998)] pose a dynamic choice argument against the random lottery incentive (RLIS) mechanism. To wit, the RLIS relies on principles of dynamic choice. Thus, experimental research on the dynamic choice principles should be conducted ina single choice design. This study attempts to evaluate the empirical validity of their argument by quasi-replicating their single choice experiment in a RLIS design. Results suggest that one may use the RLISin dynamic choice experiments. |
| Keywords: | experiments, payment approaches,non-expected utility and risk, dynamic choice principles |
| JEL: | B49 C91 D11 D81 |
| Date: | 2017–04–25 |
| URL: | http://d.repec.org/n?u=RePEc:gra:wpaper:17/02&r=dcm |
| By: | Coen, Jamie (Bank of England); Francis, William (Bank of England); Rostom, May (Bank of England) |
| Abstract: | This paper examines the determinants of credit union failure in the United Kingdom. Using regulatory data on credit unions, we estimate several discrete-time logit models and evaluate their predictive ability at one, two and three-year time horizons. We find that a small set of financial attributes related to capital adequacy, asset quality, earnings performance and liquidity is useful for early identification of troubled credit unions. Both in and out-of-sample results indicate that this parsimonious set of firm-level characteristics, augmented with national and regional unemployment rates, reliably identifies failures while keeping false alarm rates at modest levels. The results provide support for establishing early-warning criteria for supervisory use in monitoring credit unions. |
| Keywords: | Credit unions; failure; early warning; logit; policymaker loss function |
| JEL: | G21 G28 G38 |
| Date: | 2017–04–21 |
| URL: | http://d.repec.org/n?u=RePEc:boe:boeewp:0658&r=dcm |