Statistical Models Commons^™

An Automatic Interaction Detection Hybrid Model For Bankcard Response Classification, Yan Wang, Sherry Ni, Brian Stone

Published and Grey Literature from PhD Candidates

Data mining techniques have numerous applications in bankcard response modeling. Logistic regression has been used as the standard modeling tool in the financial industry because of its almost always desirable performance and its interpretability. In this paper, we propose a hybrid bankcard response model, which integrates decision tree-based chi-square automatic interaction detection (CHAID) into logistic regression. In the first stage of the hybrid model, CHAID analysis is used to detect the possible potential variable interactions. Then in the second stage, these potential interactions are served as the additional input variables in logistic regression. The motivation of the proposed hybrid model …