The use of conjoint analysis to review the attractiveness of credit conditions
Journal Title: Acta Economica - Year 2012, Vol 10, Issue 16
Abstract
The increase in aggregate demand is one of the primary goals of every economy. By achieving this goal, many positive effects in economy are also achieved which is manifested through increase in consumption, investment and creating a better social environment. The state has the key role in achieving this goal, with its instruments and policies it directs economy toward demand increase. Although all economies aspire to this goal, many are not in position to realize the goal they have set for themselves. The alternative, in an effort to increase aggregate demand, may be the banking sector. Increase in volume of loans directly influences the growth of demand. Commercial banks, like all companies, strive to continually increase their value on the market and to better position themselves. One way to succeed in doing so is to increase the income. Given the specificity of commercial banking, their goal is achieved, inter alia, by improving of lending. In order to increase income on this basis, a very important prerequisite is the formation of attractive credit offers with the strong emphasis on respecting the views of clients on this issue. To respect and value clients` views means identifying key factors and adjusting the offer to them. The power of conjoint analysis is that it allows us to get the answer to this problem. The algorithm of this analysis is a multivariate procedure to measure the preferences of bank clients regarding the loan attributes. Conjoint analysis relies on a survey of bank clients with the representative set of attributes that are ranked according to clients` preferences. Obtained quantitative informations can be used to model the credit offer. For example, one commercial bank is interested in forming a new attractive credit offer and wants to study the influence of several factors (attributes) on client preferences in order to determine which factor is the most important one.
Authors and Affiliations
Дарко Милуновић, Дарија Милуновић
Keywords
Related Articles
- EP ID EP43743
- DOI -
- Views 223
- Downloads 0
RESPONSES OF BOSNIA AND HERZEGOVINA FINANCIAL SECTOR TO FINANCIAL CRISIS AND RECESION
The paper deals with economic and financial crisis that spilled over from trading partners into Bosnia and Herzegovina. The key issue is how financial sector of the country responds to the current crisis and what measure...
THE FEEDBACK OF COMMUNICATION
Making the feedback of communication is a phase of communicational process, which has special role and importance in communication between managers and workers. Therefore, because the feedback of communication, like fina...
CONVERGENCE THEORY AND THE POSSIBILITY OF A "THIRD WAY"
The twentieth century is characterized by competition between two economic and political systems: the capitalist and socialist. It is not difficult to conclude that both systems have as their good, and bad sides. In the...
Key Dimensions of the Quality of Employment in Serbia
Labour market in the Republic of Serbia has been subject to various macroeconomic shocks and institutional changes since the beginning of 2000. The main motivation for institutional reforms oriented towards less strict e...
THE SUBPRIME MORTGAGE LOANS AS AN INITIATOR TO ACCELERATE THE EMERGENCE OF CREDIT MORTGAGE CRISIS
The working paper analyzes the "subprime" mortgage loans as instability accelerators in the mortgage market, with regard to transmission of disorders from the real estate market to credit markets and financial sector. In...