How to Construct Nationally Representative Firm Level Data from the Orbis Global Database: New Facts on SMEs and Aggregate Implications for Industry Concentration

Abstract

We construct representative firm-level longitudinal data for twenty-seven European countries using financial statements from the Orbis global database, providing a “how-to” guide on the construction. We validate our dataset by comparing its aggregate coverage to official statis- tics and present three new facts. First, smaller firms (SMEs) account for the largest share of economic activity. Second, industry concentration has increased among firms that report only consolidated statements, but decreased overall. Third, the increased concentration is accounted for by foreign-owned firms. Documenting these facts requires nationally representative data both in cross-sectional and time-series dimensions.

Keywords: data construction, new facts, market shares, selected firms

JEL Classification: E0, F0, O0