Small area estimation of household expenditures based on a bivariate nested error regression model.

M. J. Lombardía Cortiña, M. D. Esteban Lefler, E. López Vizcaíno, D. Morales González, A. Pérez Martín

The Spanish Household Budget Survey is annually carried out by the “Instituto Nacional de Estadística (INE)”, with the objective of obtaining information on the nature and destination of consumption expenses, as well as on various characteristics related to the conditions of household life.

The main objective of this work is to estimate averages and ratios of household expenditures, in food, housing, leisure and others, by Spanish provinces. To carry out these estimations, we use a bivariate nested error regression model for small areas. Based on the selected model, we calculate the empirical best linear unbiased predictors of the target parameters by provinces. The mean squared error is analytically approximated and an explicit-formula estimator is derived. All this is validated in a complete simulation study. Finally, some maps of averages and ratios of household expenditures by Spanish provinces is given.

Palabras clave: Empirical Best Linear Unbiased Predictor Nested Error Regression Model Small Area Estimation.

I. Molina Peralta, A. Bikauskaite, D. Morales

D. Morales González, J. P. Burgard, M. D. Esteban Lefler, A. Pérez Martín