Publication: Empirical Econometric Evaluation of Alternative Methods of Dealing with Missing Values in Investment Climate Surveys
Loading...
Published
2010-06-01
ISSN
Date
2012-03-19
Author(s)
Editor(s)
Abstract
Investment climate Surveys are valuable instruments that improve our understanding of the economic, social, political, and institutional factors determining economic growth, particularly in emerging and transition economies. However, at the same time, they have to overcome some difficult issues related to the quality of the information provided; measurement errors, outlier observations, and missing data that are frequently found in these datasets. This paper discusses the applicability of recent procedures to deal with missing observations in investment climate surveys. In particular, it presents a simple replacement mechanism -- for application in models with a large number of explanatory variables -- which in turn is a proxy of two methods: multiple imputations and an export-import algorithm. The performance of this method in the context of total factor productivity estimation in extended production functions is evaluated using investment climate surveys from four countries: India, South Africa, Tanzania, and Turkey. It is shown that the method is very robust and performs reasonably well even under different assumptions on the nature of the mechanism generating missing data.
Link to Data Set
Citation
“Escribano, Alvaro; Pena, Jorge; Guasch, J. Luis. 2010. Empirical Econometric Evaluation of Alternative Methods of Dealing with Missing Values in Investment Climate Surveys. Policy Research working paper ; no. WPS 5346. © World Bank. http://hdl.handle.net/10986/3832 License: CC BY 3.0 IGO.”
Digital Object Identifier
Associated URLs
Associated content
Other publications in this report series
Publication Climate and Social Sustainability in Fragility, Conflict, and Violence Contexts(Washington, DC: World Bank, 2026-01-07)Climate change is widely recognized as a driver of violent conflict, but its broader social effects remain less understood. Ignoring these dimensions risks a vicious cycle where climate policies might undermine socially just adaptation. Evidence is still limited on how climate shocks influence political participation, trust, or migration. This paper helps fill that gap by examining links between climate change, conflict, and social sustainability, with a focus on inclusion, resilience, cohesion, and legitimacy. Using secondary data from 2019–24, the study applies simple correlation-based methods to test three hypotheses on the nature, severity, and composition of these associations. The analysis combines multiple climate impact measures, new conflict classifications, recent social sustainability frameworks, and controls for population and geography. The results reveal strong correlations—not causation—between climate events and contexts of fragility, conflict, and violence. Climate impacts are most pronounced in both national and subnational conflict settings. The study also finds robust links between fragility, conflict, and violence and low levels of social sustainability, reflecting its role as both a driver and consequence of conflict. Some dimensions—such as violent events and insecurity—appear weaker in areas most affected by climate shocks. Two of the hypotheses are supported, and one remains inconclusive.Publication The Macroeconomic Implications of Climate Change Impacts and Adaptation Options(Washington, DC: World Bank, 2025-05-29)Estimating the macroeconomic implications of climate change impacts and adaptation options is a topic of intense research. This paper presents a framework in the World Bank's macrostructural model to assess climate-related damages. This approach has been used in many Country Climate and Development Reports, a World Bank diagnostic that identifies priorities to ensure continued development in spite of climate change and climate policy objectives. The methodology captures a set of impact channels through which climate change affects the economy by (1) connecting a set of biophysical models to the macroeconomic model and (2) exploring a set of development and climate scenarios. The paper summarizes the results for five countries, highlighting the sources and magnitudes of their vulnerability --- with estimated gross domestic product losses in 2050 exceeding 10 percent of gross domestic product in some countries and scenarios, although only a small set of impact channels is included. The paper also presents estimates of the macroeconomic gains from sector-level adaptation interventions, considering their upfront costs and avoided climate impacts and finding significant net gross domestic product gains from adaptation opportunities identified in the Country Climate and Development Reports. Finally, the paper discusses the limits of current modeling approaches, and their complementarity with empirical approaches based on historical data series. The integrated modeling approach proposed in this paper can inform policymakers as they make proactive decisions on climate change adaptation and resilience.Publication Institutional Capacity for Policy Implementation: An Analytical Framework(Washington, DC: World Bank, 2026-01-07)State capacity is an important prerequisite for policy implementation, yet at the country level it is difficult to measure, assess, and reform. This paper proposes a focus on institutional capacity: the ability of public institutions to implement the specific policy mandates for which they are responsible. Based on a review of existing literature, the paper defines the different dimensions that compose institutional capacity and groups them into two cross-cutting categories: organizational dimensions (personnel, financial resources, information systems, and management practices) and governance dimensions (transparency, independence, and accountability). The paper proposes measures for organizational and governance dimensions using existing data, shows intra-institutional variation of these measures within countries, and discusses how new data could be collected for better measurement of these concepts. Finally, the paper illustrates how the framework can be used to diagnose the sources of common problems related to weak policy implementation.Publication South Africa’s Fragmented Cities: The Unequal Burden of Labor Market Frictions(Washington, DC: World Bank, 2026-01-08)Using high-resolution administrative, census, and satellite data, this paper shows that South African cities are characterized by spatial mismatches between where people live and where jobs are located, relative to 20 global peers. Areas within 5 kilometers of commercial centers have 9,300 fewer residents per square kilometer than expected, which is 60 percent below the global median. Poor, dense neighborhoods are most affected. In Johannesburg, a 10-percentile increase in distance from the nearest business hub corresponds to a 3.7-percentile drop in asset wealth (a proxy of household wellbeing) and 4.9-percentile drop in employment. In Cape Town, the declines are 4.0 and 3.7 percentiles, respectively. Employment is 87 percent lower in the poorest decile than the richest in Johannesburg and 61 percent lower in Cape Town. These findings suggest that South Africa’s spatial organization of people and economic activity constrains agglomeration and reinforces inequality. This methodology provides a scalable and standardized data-driven framework to analyze spatial accessibility and agglomeration frictions in complex, data-constrained urban systems.Publication Investment in Emerging and Developing Economies(Washington, DC: World Bank, 2026-01-07)The world faces a pressing challenge to meet key development objectives amid slowing growth and rising macroeconomic and geopolitical risks. With the number of job seekers rising rapidly, infrastructure shortfalls continuing to be large, and climate costs mounting, the case for a significant investment push has never been stronger. Yet the capacity to respond in many emerging markets and developing economies has eroded. Since the global financial crisis, investment growth has slowed to about half its pace in the 2000s, with both public and private investment weakening. Foreign direct investment inflows—a critical source of capital, technology, and managerial know-how—have also fallen sharply and become increasingly concentrated, leaving low-income countries with only a marginal share. The risks of further retrenchment are significant, as trade tensions, policy uncertainty, and elevated debt levels continue to weigh on investment. Reigniting momentum will require ambitious domestic reforms to strengthen institutions, rebuild macro-fiscal stability, and deepen trade and investment integration—the foundations of a supportive business climate. At the same time, international cooperation is indispensable. A renewed commitment to a predictable system of cross-border trade and investment flows, combined with scaled-up financial support and sustained technical assistance, is essential to help emerging markets and developing economies—especially low-income countries and economies in fragile and conflict situations—bridge financing gaps and implement the domestic reforms needed to restore investment as an engine of growth, jobs, and development.
Journal
Journal Volume
Journal Issue
Collections
Related items
Showing items related by metadata.
Publication Pakistan's Investment Climate : Laying the Foundation for Renewed Growth, Volume 3. Background Paper on Econometric Methods(Washington, DC, 2009-12)Pakistan has faced a seismic shift in its global and domestic economic landscape which until recently limited policy options to address investment climate concerns. External shocks, internal policy inaction and political turmoil placed the country in a precarious economic condition, calling on the authorities to take a hard look at the policy choices ahead. Macroeconomic instability resulting in inflation, exchange rate depreciation, and a rapid depletion in foreign reserves became acute in 2007-08, with the adjustment accompanied by a reduction in investment, export and output growth. The recent slowdown in global demand for world trade along with supply shocks from the domestic economy has exacerbated an already monumental challenge for Pakistani firms to prosper and policy makers to respond. As external market conditions and Pakistan's own stabilization program temper economic expectations, opportunities abound to lay the foundation for expansion. Given Pakistan's geopolitical positioning, growing labor participation rates, and improvements in the standard of living, significant poverty outcomes can be achieved through sustained economic growth. Even, in the short run, during periods of slower growth, banking system weakness, and corporate distress, Pakistan can take the opportunity to position itself for the inevitable global rebound. Concerted efforts now can improve firm level productivity, fluidity of markets for labor, capital and land, as well as goods, and therefore, better resource use and global competitiveness.Publication Missing(ness) in Action : Selectivity Bias in GPS-Based Land Area Measurements(World Bank, Washington, DC, 2013-06)Land area is a fundamental component of agricultural statistics, and of analyses undertaken by agricultural economists. While household surveys in developing countries have traditionally relied on farmers' own, potentially error-prone, land area assessments, the availability of affordable and reliable Global Positioning System (GPS) units has made GPS-based area measurement a practical alternative. Nonetheless, in an attempt to reduce costs, keep interview durations within reasonable limits, and avoid the difficulty of asking respondents to accompany interviewers to distant plots, survey implementing agencies typically require interviewers to record GPS-based area measurements only for plots within a given radius of dwelling locations. It is, therefore, common for as much as a third of the sample plots not to be measured, and research has not shed light on the possible selection bias in analyses relying on partial data due to gaps in GPS-based area measures. This paper explores the patterns of missingness in GPS-based plot areas, and investigates their implications for land productivity estimates and the inverse scale-land productivity relationship. Using Multiple Imputation (MI) to predict missing GPS-based plot areas in nationally-representative survey data from Uganda and Tanzania, the paper highlights the potential of MI in reliably simulating the missing data, and confirms the existence of an inverse scale-land productivity relationship, which is strengthened by using the complete, multiply-imputed dataset. The study demonstrates the usefulness of judiciously reconstructed GPS-based areas in alleviating concerns over potential measurement error in farmer-reported areas, and with regards to systematic bias in plot selection for GPS-based area measurement.Publication Updating Poverty Estimates at Frequent Intervals in the Absence of Consumption Data : Methods and Illustration with Reference to a Middle-Income Country(World Bank Group, Washington, DC, 2014-09)Obtaining consistent estimates on poverty over time as well as monitoring poverty trends on a timely basis is a priority concern for policy makers. However, these objectives are not readily achieved in practice when household consumption data are neither frequently collected, nor constructed using consistent and transparent criteria. This paper develops a formal framework for survey-to-survey poverty imputation in an attempt to overcome these obstacles, and to elevate the discussion of these methods beyond the largely ad-hoc efforts in the existing literature. The framework introduced here imposes few restrictive assumptions, works with simple variance formulas, provides guidance on the selection of control variables for model building, and can be generally applied to imputation either from one survey to another survey with the same design, or to another survey with a different design. Empirical results analyzing the Household Expenditure and Income Survey and the Unemployment and Employment Survey in Jordan are quite encouraging, with imputation-based poverty estimates closely tracking the direct estimates of poverty.Publication Growth Empirics and Reality(Washington, DC: World Bank, 2001-05)This article questions current empirical practice in the study of growth. It argues that much of the modern empirical growth literature is based on assumptions about regressors, residuals, and parameters that are implausible from the perspective of both economic theory and the historical experiences of the countries under study. Many of these problems, it argues, are forms of violations of an exchangeability assumption that implicitly underlies standard growth exercises. The article shows that these implausible assumptions can be relaxed by allowing for uncertainty in model specification. Model uncertainty consists of two types: theory uncertainty, which relates to which growth determinants should be included in a model; and heterogeneity uncertainty, which relates to which observations in a data set constitute draw from the same statistical model. The article proposes ways to account for both theory and heterogeneity uncertainty. Finally, using an explicit decision-theoretic framework, the authors describe how one can engage in policy-relevant empirical analysis.Publication Re-Re-Reply to "The Impact of Microcredit on the Poor in Bangladesh : Revisiting the Evidence"(World Bank, Washington, DC, 2014-03)"The Impact of Microcredit on the Poor in Bangladesh: Revisiting the Evidence," by David Roodman and Jonathan Morduch (2014) (henceforth RM) is the most recent of a sequence of papers and web postings that seeks to refute the findings of the Pitt and Khandker (1998; henceforth PK) article "The Impact of Group-Based Credit on Poor Households in Bangladesh: Does the Gender of Participants Matter?" that microcredit for women had significant, favorable effects on household consumption and other outcomes. In this version of RM, the authors have backed off many of their prior claims and methods after earlier replies noted their faults (see Pitt (1999), Pitt (2011a), Pitt (2011b), and Pitt and Khandker (2012)). Nonetheless, important claims against PK remain in this new version of RM and are addressed below. Readers should refer to Pitt and Khandker (2012) for a discussion of other issues with RM, including a discussion of the bimodal likelihood.
Users also downloaded
Showing related downloaded files
Publication The Container Port Performance Index 2023(Washington, DC: World Bank, 2024-07-18)The Container Port Performance Index (CPPI) measures the time container ships spend in port, making it an important point of reference for stakeholders in the global economy. These stakeholders include port authorities and operators, national governments, supranational organizations, development agencies, and other public and private players in trade and logistics. The index highlights where vessel time in container ports could be improved. Streamlining these processes would benefit all parties involved, including shipping lines, national governments, and consumers. This fourth edition of the CPPI relies on data from 405 container ports with at least 24 container ship port calls in the calendar year 2023. As in earlier editions of the CPPI, the ranking employs two different methodological approaches: an administrative (technical) approach and a statistical approach (using matrix factorization). Combining these two approaches ensures that the overall ranking of container ports reflects actual port performance as closely as possible while also being statistically robust. The CPPI methodology assesses the sequential steps of a container ship port call. ‘Total port hours’ refers to the total time elapsed from the moment a ship arrives at the port until the vessel leaves the berth after completing its cargo operations. The CPPI uses time as an indicator because time is very important to shipping lines, ports, and the entire logistics chain. However, time, as captured by the CPPI, is not the only way to measure port efficiency, so it does not tell the entire story of a port’s performance. Factors that can influence the time vessels spend in ports can be location-specific and under the port’s control (endogenous) or external and beyond the control of the port (exogenous). The CPPI measures time spent in container ports, strictly based on quantitative data only, which do not reveal the underlying factors or root causes of extended port times. A detailed port-specific diagnostic would be required to assess the contribution of underlying factors to the time a vessel spends in port. A very low ranking or a significant change in ranking may warrant special attention, for which the World Bank generally recommends a detailed diagnostic.Publication Global Economic Prospects, June 2025(Washington, DC: World Bank, 2025-06-10)The global economy is facing another substantial headwind, emanating largely from an increase in trade tensions and heightened global policy uncertainty. For emerging market and developing economies (EMDEs), the ability to boost job creation and reduce extreme poverty has declined. Key downside risks include a further escalation of trade barriers and continued policy uncertainty. These challenges are exacerbated by subdued foreign direct investment into EMDEs. Global cooperation is needed to restore a more stable international trade environment and scale up support for vulnerable countries grappling with conflict, debt burdens, and climate change. Domestic policy action is also critical to contain inflation risks and strengthen fiscal resilience. To accelerate job creation and long-term growth, structural reforms must focus on raising institutional quality, attracting private investment, and strengthening human capital and labor markets. Countries in fragile and conflict situations face daunting development challenges that will require tailored domestic policy reforms and well-coordinated multilateral support.Publication Global Economic Prospects, January 2025(Washington, DC: World Bank, 2025-01-16)Global growth is expected to hold steady at 2.7 percent in 2025-26. However, the global economy appears to be settling at a low growth rate that will be insufficient to foster sustained economic development—with the possibility of further headwinds from heightened policy uncertainty and adverse trade policy shifts, geopolitical tensions, persistent inflation, and climate-related natural disasters. Against this backdrop, emerging market and developing economies are set to enter the second quarter of the twenty-first century with per capita incomes on a trajectory that implies substantially slower catch-up toward advanced-economy living standards than they previously experienced. Without course corrections, most low-income countries are unlikely to graduate to middle-income status by the middle of the century. Policy action at both global and national levels is needed to foster a more favorable external environment, enhance macroeconomic stability, reduce structural constraints, address the effects of climate change, and thus accelerate long-term growth and development.Publication Using Immunization Coverage Rates for Monitoring Health Sector Performance : Measurement and Interpretation Issues(World Bank, Washington, DC, 2000-08)Immunization against childhood diseases such as diphtheria, pertussis, tetanus, polio and measles is one of the most important means of preventing childhood morbidity and mortality. Despite the low cost of basic childhood immunizations, nearly 3 million children still die each year from vaccine-preventable diseases. Achieving and maintaining high levels of immunization coverage must therefore be a priority for all health systems. In order to monitor progress in achieving this objective, immunization coverage data can serve as an indicator of a health system's capacity to deliver essential services to the most vulnerable members of a population. This note discusses the use of trends in immunization coverage data, and argues that immunization is a health output with a strong impact on child morbidity, child mortality and permanent disability. This note discusses measurement and interpretation issues for coverage data collected through surveys and administrative records.Publication Business Ready 2024(Washington, DC: World Bank, 2024-10-03)Business Ready (B-READY) is a new World Bank Group corporate flagship report that evaluates the business and investment climate worldwide. It replaces and improves upon the Doing Business project. B-READY provides a comprehensive data set and description of the factors that strengthen the private sector, not only by advancing the interests of individual firms but also by elevating the interests of workers, consumers, potential new enterprises, and the natural environment. This 2024 report introduces a new analytical framework that benchmarks economies based on three pillars: Regulatory Framework, Public Services, and Operational Efficiency. The analysis centers on 10 topics essential for private sector development that correspond to various stages of the life cycle of a firm. The report also offers insights into three cross-cutting themes that are relevant for modern economies: digital adoption, environmental sustainability, and gender. B-READY draws on a robust data collection process that includes specially tailored expert questionnaires and firm-level surveys. The 2024 report, which covers 50 economies, serves as the first in a series that will expand in geographical coverage and refine its methodology over time, supporting reform advocacy, policy guidance, and further analysis and research.