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Statistical Issues In Predictive Modelling Using Bootstrap Method, Elmira Kushta, Miranda Pajo, Orgeta Gjermeni

UBT International Conference

A model is a statement of reality or its approximation. Most phenomena in the social sciences are extremely complex. With a model we simplify the reality and focus on a manageable number of factors. It is impossible to completely understand why consumers default and identify all the factors influencing customer’s default behavior. The bank manager sets up a statistical model that relates customer’s default behavior to only two important factors, the income and the education. There surely are thousands of other variables that may influence customer’s default behavior. This article describes the fundamentals of a statistical model building. We begin …