Protecting Confidentiality of Business Microdata by Masking

Before government agencies can release confidential microdata with identification removed, they must be certain that the data cannot be linked to specific individuals or businesses. This paper looks at five ways of masking microdata: adding random error, multiplying by random error, grouping, random rounding, and data swapping. The five strategies were used to mask tax data on individual businesses. Each strategy was then evaluated on the basis of how well it protected confidentiality and maintained the value of the data for economic analysis.