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New Firm Formation — is VAT Registration Data an Accurate Indicator?

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  • John Ball

    (Swansea Business School, University of Wales, UK)

Abstract

This paper utilises a novel and original data set collected from a survey of entirely new firms in south Wales. It compares this survey with published VAT data to address the extent to which published VAT registration actually reflects the amount of new firm formation taking place. Using this survey and a chi square test, this article offers evidence of the deficiencies of published VAT data when used as a proxy for new firm formation and suggests caution in the use of VAT data.

Suggested Citation

  • John Ball, 2007. "New Firm Formation — is VAT Registration Data an Accurate Indicator?," Local Economy, London South Bank University, vol. 22(3), pages 279-292, August.
    • Handle: RePEc:sae:loceco:v:22:y:2007:i:3:p:279-292
    DOI: 10.1080/02690940701584698
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    References listed on IDEAS

    as
    1. Storey, David J & Johnson, Steven G, 1987. "Regional Variations in Entrepreneurship in the U.K," Scottish Journal of Political Economy, Scottish Economic Society, vol. 34(2), pages 161-173, May.
    2. Johnson, Peter & Conway, Cheryl, 1997. "How Good Are the U.K. VAT Registration Data at Measuring Firm Births?," Small Business Economics, Springer, vol. 9(5), pages 403-409, October.
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