Data quality problems troubling business and financial researchers: A literature review and synthetic analysis

Abstract

The data quality of commercial business and financial databases greatly affects research quality and reliability. The presence of data quality problems can not only distort research results, destroy a research effort but also seriously damage management decisions based upon such research. Although library literature rarely discusses data quality problems, business literature reports a wide range of data quality issues, many of which have been systematically tested with statistical methods. This article reviews a collection of the business literature that provides a critical analysis on the data quality of the most frequently used business and finance databases including the Center for Research in Security Prices (CRSP), Compustat, S&P Capital IQ, I/B/E/S, Datastream, Worldscope, Securities Data Company (SDC) Platinum, and Bureau van Dijk (BvD) Orbis and identifies 11 categories of common data quality problems, including missing values, data errors, discrepancies, biases, inconsistencies, static header data, standardization, changes in historic data, lack of transparency, reporting time issues and misuse of data. Finally, the article provides some practical advice for librarians to facilitate their scholarly communications with researchers on data quality problems.