Banking Case Study Using CART | Central Bank of Armenia

Early Warning System of Currency Crisis in Central and Eastern Europe with CART Classification Trees

"In a crisis, you are hostage of your past"
Guillermo Calvo

Topics covered in this paper:
  • The principles of Early Warning Systems (EWS)
  • Applicable models of Early Warning Systems
  • Graphical explanation of the crisis classification tree
  • Advantages and disadvantages of CART

This paper tries to look to currency crises from interesting perspective by using the method Classification trees to explain and predict the crises.