https://stackoverflow.com/a/9824943/14731 contains a better answer (one that is more readable and works with set -o nounset
enabled). It works roughly like this:
if [ -n "${VAR-}" ]; then
echo "VAR is set and is not empty"
elif [ "${VAR+DEFINED_BUT_EMPTY}" = "DEFINED_BUT_EMPTY" ]; then
echo "VAR is set, but empty"
else
echo "VAR is not set"
fi