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Understanding Business Dynamics: An Integrated Data System for America’s Future
business dynamics might follow units subject to high likelihoods of change for longer periods and units that are unlikely to undergo major changes only briefly. Determining the strata for long follow-up and short follow-up would require some study for each outcome variable selected.
Finally, a separate issue is the length of the interwave interval—how often should a sample unit be measured? If life expectancy is low for new businesses, frequent measurement is needed to acquire observations about life-cycle processes. There are many attributes of new businesses for which information is essential (e.g., payroll, employment counts). To reduce the reporting burden of high-frequency measurement, new alliances between the federal statistical agencies and payroll processing firms might be considered; use of scanner data for sales volume estimates might also be studied. Other variables may not require such frequent measurement to be useful (e.g., use of new technologies). Clearly, measurement of business dynamics would benefit if the method of record construction permitted data to be acquired from units in a temporally flexible manner.