Logistic Ensemble Models

06/12/2018
by   Bob Vanderheyden, et al.
0

Predictive models that are developed in a regulated industry or a regulated application, like determination of credit worthiness, must be interpretable and rational (e.g., meaningful improvements in basic credit behavior must result in improved credit worthiness scores). Machine Learning technologies provide very good performance with minimal analyst intervention, making them well suited to a high volume analytic environment, but the majority are black box tools that provide very limited insight or interpretability into key drivers of model performance or predicted model output values. This paper presents a methodology that blends one of the most popular predictive statistical modeling methods for binary classification with a core model enhancement strategy found in machine learning. The resulting prediction methodology provides solid performance, from minimal analyst effort, while providing the interpretability and rationality required in regulated industries, as well as in other environments where interpretation of model parameters is required (e.g. businesses that require interpretation of models, to take action on them).

READ FULL TEXT

Authors

page 1

page 2

page 3

page 4

09/28/2020

Transparency, Auditability and eXplainability of Machine Learning Models in Credit Scoring

A major requirement for credit scoring models is to provide a maximally ...
09/10/2020

Actionable Interpretation of Machine Learning Models for Sequential Data: Dementia-related Agitation Use Case

Machine learning has shown successes for complex learning problems in wh...
11/02/2021

Designing Inherently Interpretable Machine Learning Models

Interpretable machine learning (IML) becomes increasingly important in h...
08/31/2021

Look Who's Talking: Interpretable Machine Learning for Assessing Italian SMEs Credit Default

Academic research and the financial industry have recently paid great at...
04/26/2022

Explaining Adverse Actions in Credit Decisions Using Shapley Decomposition

When a financial institution declines an application for credit, an adve...
11/20/2020

PSD2 Explainable AI Model for Credit Scoring

The aim of this paper is to develop and test advanced analytical methods...
This week in AI

Get the week's most popular data science and artificial intelligence research sent straight to your inbox every Saturday.