Theoretical and Applied Economics
No. 4 / 2019 (621), Winter
A Deep Neural Network (DNN) based classification model in application to loan default prediction
R&D Center, C/S Information Technologies, Istanbul, Turkey
Orkun SUSUZ
R&D Center, C/S Information Technologies, Istanbul, Turkey
Abstract. In this study, we applied a Deep Neural Networks (DNN) based classification model along with the conventional classification methods (Logistic Regression, Decision Tree, Naïve Bayes and Support Vector Machines) on a two distinct datasets containing characteristics of the loan clients in a medium-sized Turkish commercial bank. Python programming language and libraries (Sklearn, Tensorflow and Keras) have been used in data cleaning, data preparation, feature engineering and model implementation processes. Our empirical findings document that the accuracy of the deep learning classification model increases with the size of the dataset, implying that the deep learning models might yield better results than regression-based models in more complex datasets.
Contents
Expanding the Eurozone. The stage of economic convergence for Bulgaria, Czech Republic, Croatia, Hungary, Poland and Romania
Business R&D investments in the EU: Main dynamics and economic effects
Volatility experience of major world stock markets
Unemployment hysteresis analysis for OECD countries
Culture as a driving factor for foreign direct investments in the Western Development Region of Romania
A Deep Neural Network (DNN) based classification model in application to loan default prediction
The new Keynesian Phillips Curve. Implications. Strengths and weaknesses
Corporate ownership structure and performance: An enquiry into India
Turkey’s macroeconomic policy challenges in the aftermath of the 2018 crisis: A sectoral financial balances analysis
Main aspects on the nature of dynamic models
An analyses model of the Romanian privately managed pension system
Dynamic models used in analysis capital and population
Poverty rate determinants in the Central and Eastern Europe member states
Wagner versus Keynesian Hypothesis: Role of aggregate and disaggregate expenditure in Pakistan
GARCH based VaR estimation: An empirical evidence from BRICS stock markets
Does FDI substitute exports of home country? A case of US FDI in select Asian economies
Exploring the role of institutions in cross country Malmquist productivity analysis: A two-stage double bootstrap DEA approach
Does the Mundell-Fleming Model apply to Poland?
The validity of Okun’s Law: Evidences from Indian economy