International Data on Business Startups: Factors Affecting Comparability

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International Data on Business Start-upsFactors
Affecting Comparability

• Steven VALE, OECD / ONS

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The Issue

• Increasing political and academic interest in
  business demography and entrepreneurship
• Accurate measures of business start-ups are
  important indicators for both
• OECD project on international comparability of
  start-up rates
• Funded by the International Consortium for
  Dynamic Entrepreneurship Benchmarking, led by
  FORA

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Current Position

• Inventory of 49 Internet data sources from 27
  countries
• Statistical business register is the most common
  source
• Examination of metadata to try to understand the
  differences in sources
• Typology of factors affecting comparability
• Tested on countries with multiple sources

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Factors Affecting Comparability

• Reasons why data are not comparable
• Genuine variation
• Methodological differences

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Proportion of businesses with no employees
Source Taken from Business Demography in
Europe, Results for 10 Member States and Norway,
Table 2.5, published by Eurostat in 2004. Data
for 2001 (except Belgium 2000)
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Factors Affecting Comparability

• Reasons why data are not comparable
• Genuine variation
• Methodological differences
• Factors provide a framework to help understand
  methodological differences
• Start-up rates New Businesses
  Population
• Numerator and denominator factors

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Numerator Factors

• Source register, census or survey?
• Units enterprise, establishment,...?
• Scope inclusions / exclusions?
• Threshold small units?
• Time when to measure?
• Purity births or other events?

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Denominator Factors

• Population businesses or people?
• Coverage inclusions / exclusions?
• Temporal basis point in time or live during
  period?

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United States Data 4 Sources
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Conclusions

• The charts clearly show why start-up rates need
  to be broken down into their components
• Each component is affected by a number of factors
• A framework to systematically assess these
  factors helps to make better informed and more
  reliable comparisons

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What Next?

• Short-term
• Apply framework to data from different countries
• Standard methods to adjust for methodological
  differences? - Quick wins
• Impact of births how important are they really
  for job creation?

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What Next?

• Short-term
• Apply framework to data from different countries
• Standard methods to adjust for methodological
  differences? - Quick wins
• Impact of births how important are they really
  for job creation?
• Long-term
• What do data users really want?
• Gold-standard methodology

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• Thank-you for listening.
• Any Questions?
• steven.vale_at_oecd.org
• steven.vale_at_ons.gov.uk