Transforming response values in small area prediction

Shonosuke Sugasawa and Tatsuya Kubokawa

Computational Statistics & Data Analysis, 2017, vol. 114, issue C, 47-60

Abstract: In real applications of small area estimation, one often encounters data with positive response values. The use of a parametric transformation for positive response values in the Fay–Herriot model is proposed for such a case. An asymptotically unbiased small area predictor is derived and a second-order unbiased estimator of the mean squared error is established using the parametric bootstrap. Through simulation studies, a finite sample performance of the proposed predictor and the MSE estimator is investigated. The methodology is also successfully applied to Japanese survey data.

Keywords: Dual power transformation; Empirical Bayes estimation; Fay–Herriot model; Mean squared error; Positive-valued data; Small area estimation (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:csdana:v:114:y:2017:i:c:p:47-60

DOI: 10.1016/j.csda.2017.03.017

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