Developing the prototype Longitudinal Business Database: New Zealand’s Experience Julia Gretton...

Developing the prototype Longitudinal Business Database:

New Zealand’s Experience

Julia Gretton

IAOS ConferenceShanghai, China, October 2008

Email: julia.gretton@stats.govt.nz

Contents

1. The prototype LBD1

2. Development

3. Challenges and solutions

4. Legislative environment

5. Example outputs

6. Future use

7. Questions

1. Longitudinal Business Database (LBD)

1. The prototype LBD

• Use to date• Current research topics• Description• Coverage• Components

Use to date

• A selection of prototype official statistics have been produced

• Policy evaluation is being undertaken by government departments

• Informed Statistics NZ’s planning of the implementation of the Statistical Architecture

• Increased the use of microdata and ease of access• Enabled longitudinal analysis• Facilitated research (see next slide)

Current research topics

• Firm level patterns in merchandise trade • Firm dynamics, market structure and performance • Currency hedging behaviours of exporters • Comparison of quantitative and qualitative

performance measures• The impact of immigration and local workforce

characteristics on innovation and firm performance • International engagement and firm performance

Description

• Contains a wide range of data on New Zealand businesses

• The data is:– Longitudinal– Annual – Enterprise-based

• It was created by integrating administrative and survey data with Statistics NZ’s Longitudinal Business Frame

Coverage

• The LBD’s value is in its:– Length: 2000-2006 years (minimum)– Breadth: all economically significant enterprises– Depth: extensive demographic, financial, export

and survey data

Components

Goods and Services Tax

Government assistance

Customs

Employment (tax)

Company tax returns

Financial accounts (tax)

Annual Enterprise

Business Finance

Business Practices

Research & Development

Innovation

Business Operations

Administrative data Sample surveys

LBD

Longitudinal

Business

Frame

2. Development

• IBULDD (Improved Business Understanding via Longitudinal Database Development)– A two-year project to test feasibility– It developed the prototype LBD

• The project was successful due to:– Its strong governance– The cross-government support– Collaboration from data providers– An international peer group review of its direction

3. Challenges and solutions

• Database structure• Imputation• Confidentiality

Database structure

• The data came with many different formats, time periods and units of observation

• IBULDD developed the methodologies to apply standard periods and units to the data

• Decisions were made on how to structure the database

• Metadata for the completed database was created

Imputation

• Some source data already had imputation applied (eg surveys & GST)

• The LBD needed a census of key financial variables• Cases for imputation include:

– Businesses below thresholds to file returns or GST exempt– Incomplete or inconsistent returns

• Imputation methods used were:– Interpolation, historical, donor

Confidentiality

• Issues arise when data is linked• Protection methods used for the LBD include:

– Strict eligibility criteria for access applies– Users only have access to an anonymised version– Outputs are confidentialised and carefully checked

4. Legislative environment

• The LBD was developed within the requirements of three acts:– Statistics Act 1975– Tax Administration Act 1994– Privacy Act 1993

• These cover how microdata is supplied, used and accessed

5. Example outputs

• Innovation outcomes• Exporting manufacturers

Innovation outcomes

• Able to measure performance following the introduction of a product innovation

2001-02 2001–03 2001–04 2001–05

Product innovators 1656 21,341,958 691,724 532,671 777,495 620,522

Not product innovators 759 15,437,754 -655,280 -89,869 78,021 375,079

Innovation statusAverage

sales 2001 ($)

Average annualised sales growth($)Number of

enterprises

Exporting manufacturers

• Able to use a range of sources to identify exporters in the manufacturing industry and compare them with non-exporters

2000 2001 2002 2003 2004 2005

0

20

40

60Percent

Share of manufacturing enterprises Share of manufacturing employment Share of total employment

Exporting Manufacturers2000–2005

6. Future use

• Future use• Benefits

Future use

• Reduce respondent load by– Maximising use of existing data– Substituting survey data

• Efficiently produce new official statistics• Support new forms of dissemination• Enable new performance metrics to be

created• Facilitate additional research

Benefits

• Maximises use of all available data• Increases quality of outputs by improving

processes• Enables longitudinal analysis• Meets demand for evidence-based policy • Provides insight on the impact of policy and

business practices • Answers more specific research questions• Is adaptable and easy to update

7. Questions

Thank you

http://www.stats.govt.nz/economy/business/longitudinal-business-database.htm

Email: julia.gretton@stats.govt.nz