A Fay-Herriot Model with Different Random Effect Variances

0365252 - ÚTIA 2012 RIV US eng J - Journal Article
Hobza, Tomáš - Morales, D. - Herrador, M. - Esteban, M.D.
A Fay-Herriot Model with Different Random Effect Variances.
Communications in Statistics - Theory and Methods. Roč. 40, č. 5 (2011), s. 785-797. ISSN 0361-0926. E-ISSN 1532-415X
R&D Projects: GA MŠMT 1M0572
Institutional research plan: CEZ:AV0Z10750506
Keywords : small area estimation * Fay-Herriot model * Linear mixed model * Labor Force Survey
Subject RIV: BB - Applied Statistics, Operational Research
Impact factor: 0.274, year: 2011
http://library.utia.cas.cz/separaty/2011/SI/hobza-a%20fay-herriot%20model%20with%20different%20random%20effect%20variances.pdf

A modification of the Fay–Herriot model is introduced to treat situations where small areas are divided in two groups and domain random effects have different variances across the groups. The model is applicable to data having a large subset of domains where direct estimates of the variable of interest cannot be described in the same way as in its complementary subset of domains. This is generally the case when domains are constructed by crossing geographical characteristics with sex. Algorithms and formulas to fit the model, to calculate EBLUPs and to estimate mean squared errors are given. Monte Carlo simulation experiments are presented to illustrate the gain of precision obtained by using the proposed model and to get some practical conclusions. A motivating application to Spanish Labour Force Survey data is also given.
Permanent Link: http://hdl.handle.net/11104/0200537