Rocío Flores-Jimeno

This work is framed in the research of business failure. We examine a method of analyzing the dynamics of financial failure. The authors examine a method of analyzing the dynamics of financial failure, because our goal is to analyze how the economic and financial indicators show the risk of failure in a group of companies.
Using a sample of 163 companies declared bankrupt or dissolved, the authors show how to depict company trajectories of behavior and movement to terminal failure. They analyze these trajectories to find and describe empirical evidence of the different dynamics of bankruptcy. The authors also show that the estimation of failure risk is more accurate when these different failure trajectories are defined.
In conclusion, the authors can see that there are different failure trajectories. One can use these different trajectories to identify more efficiently the indicators warning of the failure risk of the companies analyzed.