Synthesizing geocodes to facilitate access to detailed geographical information in large scale administrative data

Abstract: We investigate whether generating synthetic data can be a viable strategy for providing access to detailed geocoding information for external researchers, without compromising the confidentiality of the units included in the database. Our work was motivated by a recent project at the Institute for Employment Research (IAB) in Germany that linked exact geocodes to the Integrated Employment Biographies (IEB), a large administrative database containing several million records. We evaluate the performance of three synthesizers regarding the trade-off between preserving analytical validity and limiting disclosure risks: One synthesizer employs Dirichlet Process mixtures of products of multinomials (DPMPM), while the other two use different versions of Classification and Regression Trees (CART). In terms of preserving analytical validity, our proposed synthesis strategy for geocodes based on categorical CART models outperforms the other two. If the risks of the synthetic data generated by the categorical CART synthesizer are deemed too high, we demonstrate that synthesizing additional variables is the preferred strategy to address the risk-utility trade-off in practice, compared to limiting the size of the regression trees or relying on the strategy of providing geographical information only on an aggregated level. We also propose strategies for making the synthesizers scalable for large files, present analytical validity measures and disclosure risk measures for the generated data, and provide general recommendations for statistical agencies considering the synthetic data approach for disseminating detailed geographical information.