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Small area estimation on poverty indicators

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Author Info

  • Isabel Molina

    ()

  • J.N.K. Rao

    ()

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    Abstract

    We propose to estimate non-linear small area population quantities by using Empirical Best (EB) estimators based on a nested error model. EB estimators are obtained by Monte Carlo approximation. We focus on poverty indicators as particular non-linear quantities of interest, but the proposed methodology is applicable to general non-linear quantities. Small sample properties of EB estimators are analyzed by model-based and design-based simulation studies. Results show large reductions in mean squared error relative to direct estimators and estimators obtained by simulated censuses. An application is also given to estimate poverty incidences and poverty gaps in Spanish provinces by sex with mean squared errors estimated by parametric bootstrap. In the Spanish data, results show a significant reduction in coefficient of variation of the proposed EB estimators over direct estimators for most domains.

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    File URL: http://e-archivo.uc3m.es/bitstream/10016/5644/1/ws091505.pdf
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    Bibliographic Info

    Paper provided by Universidad Carlos III, Departamento de Estadística y Econometría in its series Statistics and Econometrics Working Papers with number ws091505.

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    Date of creation: Mar 2009
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    Handle: RePEc:cte:wsrepe:ws091505

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    Related research

    Keywords: Empirical best estimator; Parametric bootstrap; Poverty mapping; Small area estimation;

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    1. Francesca Ballini & Gianni Betti & Samuel Carrette & Laura Neri, 2009. "Poverty and inequality mapping in the Commonwealth of Dominica," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 0(Special i), pages 123-162.
    2. Peter Hall & Tapabrata Maiti, 2006. "On parametric bootstrap methods for small area prediction," Journal of the Royal Statistical Society Series B, Royal Statistical Society, vol. 68(2), pages 221-238.
    3. Chris Elbers & Jean O. Lanjouw & Peter Lanjouw, 2003. "Micro--Level Estimation of Poverty and Inequality," Econometrica, Econometric Society, vol. 71(1), pages 355-364, January.
    4. Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, vol. 52(3), pages 761-66, May.
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