%0 Journal Article %T More than a Dummy: The Probability of Failure, Survival and Acquisition of Private Firms in Financial Distress %+ Groupement de Recherche et d'Etudes en Gestion à HEC (GREGH) %A Astebro, Thomas B. %A Winter, J. K. %< avec comité de lecture %@ 1740-4754 %J European Management Review %I Wiley %V 9 %N 1 %P NC %8 2012 %D 2012 %K financial distress %K forecasting %K multinomial logit %Z Humanities and Social Sciences/Business administration/domain_shs.gestion.stratJournal articles %X We discuss three methodological issues concerning forecasts of the outcome of financial distress. First, we argue that rather than using a binary model the outcome of financial distress should be modeled using a multinomial specification that distinguishes between failure, survival as going concern, and acquisition. We also argue for a random rather than matched-pair sampling technique to better reflect decision making reality. Finally, we investigate the value of using industry-mean adjusted regressors. We find that the binary bankruptcy model is mis-specified relative to the multinomial model, that the matched sampling technique overstates model accuracy and that industry specific intercepts have better explanatory power than industry-adjusted regressors. %G English %L hal-00715485 %U https://hec.hal.science/hal-00715485 %~ SHS %~ HEC %~ CNRS