Estimating the uncertainty of a small area estimator based on a microsimulation approach

Angelo Moretti, Adam Whitworth

Research output: Contribution to journalArticlepeer-review

Abstract

Spatial microsimulation encompasses a range of alternative methodological approaches for the small area estimation (SAE) of target population parameters from sample survey data down to target small areas in contexts where such data are desired but not otherwise available. Although widely used, an enduring limitation of spatial microsimulation SAE approaches is their current inability to deliver reliable measures of uncertainty—and hence confidence intervals—around the small area estimates produced. In this article, we overcome this key limitation via the development of a measure of uncertainty that takes into account both variance and bias, that is, the mean squared error. This new approach is evaluated via a simulation study and demonstrated in a practical application using European Union Statistics on Income and Living Conditions data to explore income levels across Italian municipalities. Evaluations show that the approach proposed delivers accurate estimates of uncertainty and is robust to nonnormal distributions. The approach provides a significant development to widely used spatial microsimulation SAE techniques.
Original languageEnglish
Number of pages31
JournalSociological Methods and Research
Early online date4 Feb 2021
DOIs
Publication statusE-pub ahead of print - 4 Feb 2021

Keywords

  • calibration
  • weighting
  • synthetic
  • indirect estimator
  • raking
  • resampling

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