3  Description of data

3.1  New Zealand data – the Business Demographic Statistics database

All of the New Zealand data discussed in this paper are sourced from the New Zealand Business Demographic Statistics database (BDS). A full description of this database can be found in Carroll et al (2002), but to summarise, the BDS is effectively a “snapshot” of the Business Frame (the register of all economically significant businesses in New Zealand) that is updated in February each year. The information in the BDS is derived from Statistics New Zealand surveys, particularly the Annual Business Frame Update or ABFU, that are administered to all GST-registered businesses in New Zealand (and some that are not registered), provided they satisfy at least one of the following criteria of “economic significance”:

• a) having over $30,000 annual GST expenses or sales;
• b) having more than two full time employees (including working proprietors);
• c) being in a GST-exempt industry, except residential leasing and rental;
• d) being part of a group of enterprises;
• e) being a new GST registration that is compulsory, special or forced (normally meaning that the enterprise is expected to exceed the $30,000 level); or
• f) being registered for GST and involved in agriculture or forestry.

These criteria for the database were introduced in 1994. Prior to 1994, businesses were included purely on the basis of GST registration, which is compulsory for firms with $30,000 annual turnover or more, but may also be undertaken voluntarily. Data for the periods before and after 1994 will therefore differ in some respects, and most of the analyses reported on in this paper focus on the period 1994-2001.

The BDS database contains details on business activity, number of employees, and GST sales. Data is available at both the enterprise (firm) level and the geographic unit (plant) level of analysis.

Finally, it should be noted that the BDS contains information on firms across most industries in the economy but excludes the agricultural production (farming) sector, as well as some others, primarily community services[1].

3.2  International data

The international data used for the comparisons in this paper are drawn primarily from the OECD firm-level project (Bartelsman et al, 2003), and to a lesser extent from the OECD’s analysis of the Eurostat business demography database (Brandt, 2004).

The OECD firm-level project provides data on firm dynamics and demography for ten OECD countries – the USA, Germany, France, Italy, the UK, Canada, Denmark, Finland, the Netherlands, and Portugal – primarily for the sample period 1989-1994. The data available from the Eurostat covers Belgium, Denmark, the Netherlands, Spain, Italy, Portugal, Finland, Sweden and the UK, for the sample period 1997-2000.

In addition to the OECD and Eurostat data, some separate data on firm size were also obtained from the public websites of the Australian Bureau of Statistics, the US Census Bureau, and the UK Small Business Service.