PENERAPAN MODEL WEIBULL PROPORTIONAL HAZARD DAN REGRESI COX PROPORTIONAL HAZARD PADA KONDISI FINANCIAL DISTRESS

Abstract

Companies must sustain their existence due to the business world's quick and competitive growth. In order to prevent financial distress, the corporation must manage its financial situation. One technique for figuring out the causes of financial distress is survival analysis. In survival analysis, two models are known, namely the parametric model and the semiparametric model. In this study, the parametric model uses Weibull Proportional Hazard while the semiparametric model applies Cox Proportional Hazard regression using Efron approach to overcome ties. The study's objective is to model the incidence of financial crises in Indonesian utilities, transportation, and other infrastructure providers between the years 1990 and 2021, and to compare the two methods. The length of time that a company has gone without experiencing a financial crisis is a dependent variable in this study where the independent variables consist of solvency ratio, liquidity ratio, growth ratio, profitability ratio, firm size, and activity ratio. Model selection to get the most suitable model can be done with the smallest AIC criteria. The results of the analysis obtained the appropriate model is the Weibull Proportional Hazard model with an AIC value of 282.117 and produces two significant variables, namely liquidity ratio and profitability ratio.