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Ifo Institute – Leibniz Institute for Economic Research at the University of Munich
On the Robustness of the Balance Statistics
with respect to Nonresponse
Christian Seiler
Ifo Working Paper No. 126
March 2012
An electronic version of the paper may be downloaded from the Ifo website
www.cesifo-group.de.
Ifo Working Paper No.126
On the Robustness of the Balance Statistics
with respect to Nonresponse
Abstract
Business cycle indicators based on the balance statistics are a widely used method to
monitor the actual economic situation. In contrast to official data, indicators from
business surveys are early available and typically not revised after their first publication.
But as surveys can be in general affected by distortions through the response behaviour,
these indicators can also be biased. In addition, time-dependent nonresponse patterns
can produce even more complex forms of biased results. This paper examines a
framework which kind of nonresponse patterns lead to biases and decreases in performance.
We perform an extensive Monte Carlo study to analyse their effects on the indicators.
Our analyses show that these indicators are extremely stable towards selection biases.
JEL Code: C81, C83.
Keywords: Business survey, Monte Carlo study, nonresponse.
Christian Seiler
Ifo Institute – Leibniz Institute
for Economic Research
at the University of Munich
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