It's the economy stupid: comparison of proportional hazards models with economic and socio-demographic variables for estimating the purchase of financial products

Relatively there is little empirical research that has been taken to understand how the underlying economy affects customers’ subsequent financial product purchase behaviours. A better understanding of this influence and being able to predict the probability of purchasing are important for financial service industries. This paper undertakes an examination of the impacts of social-demographic and economic variables on the probability of purchasing financial products. In particular two most common, the Cox and Weibull, proportional hazard models are compared to examine their adequacy in terms of predictive ability. The results show that the change of external economic environment is an important source that drives customers’ financial products purchasing behaviours. Furthermore, the results also that indicate Cox proportional hazard models are superior to Weibull proportional hazard models.