Title :
E-business Enterprise Credit Risk Evaluation Based on Markov Chain
Author :
Wang, Chong ; Chen, Wenkuan ; Shao, Peiji
Author_Institution :
Sch. of Econ. & Manage., Sichuan Agric. Univ., Ya´´an
Abstract :
Credit risk evaluation decisions are important for the e-business due to the high level of risk associated with wrong decisions. The process of making credit risk evaluation decision is complex and unstructured. Markov chain is known to perform reasonably well compared to alternate methods for this problem. In this work, we describe this method and the case of a successful application of it to e-business enterprise risk assessment. We built a state transmission probability matrix to analyze and predict the enterprisepsilas future credit state. The application is tested on real-world data. We show that Markov chain can be very successful in evaluating and predicting e-business enterprise credit risk.
Keywords :
Markov processes; credit transactions; electronic commerce; matrix algebra; probability; risk management; Markov chain; e-business; enterprise credit risk evaluation; enterprise risk assessment; state transmission probability matrix; Costs; Economic forecasting; Electronic commerce; Gain measurement; Risk management; Security; Technology management; Testing; Time measurement; Uncertainty; Credit risk evaluation; E-business enterprise; Markov chain;
Conference_Titel :
Electronic Commerce and Security, 2008 International Symposium on
Conference_Location :
Guangzhou City
Print_ISBN :
978-0-7695-3258-5
DOI :
10.1109/ISECS.2008.13
