1. Developing the prototype Longitudinal Business Database: New Zealand’s Experience Julia Gretton IAOS Conference Shanghai, China, October 2008 Email: julia.gretton@stats.govt.nz

2. Contents 1.The prototype LBD 1 2.Development 3.Challenges and solutions 4.Legislative environment 5.Example outputs 6.Future use 7.Questions 1. Longitudinal Business Database (LBD)

3. 1. The prototype LBD Use to date Current research topics Description Coverage Components

4. 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)

5. 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

6. 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

7. 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

8. 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 dataSample surveys LBD Longitudinal Business Frame

9. 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

10. 3. Challenges and solutions Database structure Imputation Confidentiality

11. 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

12. 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

13. 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

14. 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

15. 5. Example outputs Innovation outcomes Exporting manufacturers

16. Innovation outcomes Able to measure performance following the introduction of a product innovation

17. Exporting manufacturers Able to use a range of sources to identify exporters in the manufacturing industry and compare them with non-exporters

18. 6. Future use Future use Benefits

19. 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

20. 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

21. 7. Questions Thank you http://www.stats.govt.nz/economy/business /longitudinal-business-database.htm Email: julia.gretton@stats.govt.nz