Purpose – The purpose of this paper is to put forward an innovative approach for reducing the variation between Type I and Type II errors in the context of ratio-based modeling of corporate collapse, without compromising the accuracy of the predictive model. Its contribution to the literature...

Purpose – The purpose of this paper is to put forward an innovative approach for reducing the variation between Type I and Type II errors in the context of ratio‐based modeling of corporate collapse, without compromising the accuracy of the predictive model. Its contribution to the...