Edward I. Altman’s research while affiliated with New York University and other places

... These frameworks emphasize the importance of reductions in costs and assets to restore profitability while simultaneously investing resources to strengthen the firm's market position (Trahms et al., 2013). Recent research has bridged SME failure prediction modeling with turnaround strategies (Altman et al., 2024), while other authors have underscored the significance of entrepreneurial orientation and managerial experience as vital contributors to effective turnaround strategies (Mayr et al., 2017;Vedy et al., 2021). ...

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Predicting viability of small businesses on the edge of failure

... Initial studies focused on Japan (Ahearne and Shinada, 2005;Caballero et al., 2008;Hoshi, 2006), later expanding to China and its influential environment Shen et al., 2023). The issue is now recognized globally, with zombie firms among listed companies rising to around 7% by 2020 (Altman et al., 2024). Altman et al. (2024) highlight its uneven spread across the world's 20 largest economies, prompting questions about the country-level factors driving this phenomenon. ...

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The economic and social dilemma of zombie companies worldwide: institutional context and poverty impact analysis

... For that purpose, however, is further research required related to the measurement of entrepreneurial resilience. Some previous work on this topic has already been performed (Fatoki, 2018), but to operationalize resilience in the context of business failure prediction, additional effort is needed, similar to the operationalization of the Omega-Score (Altman et al., 2023). This could significantly reduce the risk of loan defaults and support business continuity by better identifying businesses with recovery potential. ...

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Predicting viability of small businesses on the edge of failure

... Our preference towards adaptive LASSO over other regularization methods relies on the oracle property, which guarantees a consistent selection of independent variables in large samples. For example, standard LASSO regularization (Tibshirani, 1996), which has been recently employed to predict high growth firms (Chae, 2024;Coad & Srhoj, 2020) and bankruptcy risk (Altman et al., 2023), may lead to an inconsistent selection (Zou, 2006). The adaptive LASSO regularization is defined as: ...

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The entrepreneur and the ecosystem: extending and operationalizing EE theory from an embeddedness perspective

... When there is a real estate market crisis, it has an immediate effect on investor sentiment in the real estate bond market as well as the corporate bond market. When examining the impact of the Evergrande real estate crisis on capital markets, Altman et al. (2022) find that the corporate bond market reacted more negatively and strongly during crisis events whereas equity markets reacted weaker or hardly reacted at all to events. This suggests that debt market investors are more concerned about downside risk than equity investors when considering repayment function, liquidity and market participants (Bai et al., 2019). ...

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The growth of the real estate corporate bond market in Vietnam: the role of investor sentiment

... Boubakri et al. (2013) argue that a potent government might control SOEs to make prudent investment decisions to maintain social benefits and employment prospects in the context of privatization. Concentrated ownership benefits firms by mitigating FD, as large shareholders (blockholders) have incentives to curb managerial actions, such as excessive risk-taking (Miglani et al., 2015) but ownership concentration magnifies the risk of Vietnamese companies (Tran & Le, 2020). Firms with CEO ownership have a lower FD probability (Brédart, 2013). ...

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Stock return volatility and financial distress: Moderating roles of ownership structure, managerial ability, and financial constraints

... In order to analyze the impact of Evergrande's bond default in September 2021 on six Asian stock indexes (to consider the possible stock market integration), we use an event study approach. Although this methodology has been widely used in the financial literature to assess the impact of unanticipated events, as we can notice, excluding the study of Altman et al. (2022), which is only focused on Chinese markets, this is the first study to apply this methodology to analyze the impact of Evergrande's September 2021 bond default on various Asian financial markets. In addition, we analyze the indexes before and after the event date and compare return means and variances to find possible differences in the behavior of the series under analysis. ...

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A Giant Falls: The Impact of Evergrande on Asian Stock Indexes

... Finanç. -USP, São Paulo, v. 35, n. 95, e1913, 2024 financial market (Fernandes, 2020;Sharif et al., 2020), firm bankruptcy (Bernardi et al., 2021), corporate performance (Hu & Zhang, 2021), and credit risk downgrades (Altman et al., 2022). ...

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Impact of the COVID-19 outbreak on credit ratings: Application of the through-the-cycle approach

... In columns 1-2 of Table 11, where the list of control variables is adopted based on the related literature [66,67] to yield estimation results of financial distress, we observe a negative association between banking uncertainty and Z-score-a reverse measure of financial distress. This indicates that uncertainty leads to an escalation of firm financial distress risk. ...

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Uncertainty in banking and debt financing of firms in Vietnam

... al., (2008) in their research about the missing period in Japan 1990iest. With the COVID-19 situation entering its 3rd year, it has impact on the raising concern between governments, bank centrals, academics, media, and event judges that handle the bankruptcy claim regarding the increase numbers of zombie firms in the late several years (Altman et al., 2021). Hofmann (2018, 2020) indicate that zombie firms have increase significantly in the last 30 years, where only 2% in early 1990 became 12% in 2018, even though the global economy has shown improvements within the years. ...

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Calculating Corporate Default Risk: Zombie Firm Model