Picture water droplets

Developing mathematical theories of the physical world: Open Access research on fluid dynamics from Strathclyde

Strathprints makes available Open Access scholarly outputs by Strathclyde's Department of Mathematics & Statistics, where continuum mechanics and industrial mathematics is a specialism. Such research seeks to understand fluid dynamics, among many other related areas such as liquid crystals and droplet evaporation.

The Department of Mathematics & Statistics also demonstrates expertise in population modelling & epidemiology, stochastic analysis, applied analysis and scientific computing. Access world leading mathematical and statistical Open Access research!

Explore all Strathclyde Open Access research...

It's the economy stupid : modelling financial product purchases

Tang, Leilei and Thomas, L. and Thomas, S. and Bozzetto, J. (2007) It's the economy stupid : modelling financial product purchases. International Journal of Bank Marketing, 25 (1). pp. 22-38. ISSN 0265-2323

Full text not available in this repository. Request a copy from the Strathclyde author

Abstract

Purpose – The purpose of this research is to undertake an examination of the impacts of socio-demographic and economic variables on the probability of purchasing financial products. There is relatively little empirical research that has been taken to understand how the underlying economy affects customers' subsequent financial product purchase behaviours. Understanding this influence would improve prediction of when purchases will occur and hence is important for the Customer lifetime value models of financial service organisations. Design/methodology/approach – Two proportional hazard modelling approaches – Cox and Weibull – are compared in terms of predictive ability on a data set from a major insurance company. The risk factors for purchase are both economic and socio-demographic. Findings – The results show that the external economic environment is an extremely important influence in driving customers' financial products purchasing behaviours. Furthermore, the results also indicate that Cox's proportional hazard models are superior to Weibull proportional hazard models in this case because of an annual purchase effect. Practical implications – Financial organisations need to consider the current economic conditions before determining how much marketing effort to undertake. Originality/value – The originality of this paper is that it considers economic conditions and socio-demographic variables in modelling the long run purchase behaviour of customers for insurance and savings products. It has a large data set from a major insurance company. It is also one of the first papers to make a detailed comparison between the semi-parametric and parametric proportional hazard models in the bank marketing area.