Small Area Estimation

Introduction

Over the past three decades there is a growing demand in many countries for reliable estimates of small domain parameters such as means, counts, proportions or quantiles. Common examples include the estimation of unemployment rates, proportions of people under poverty, disease incidence and use of illicit drugs. These estimates are used for fund allocations, new social or health programs, and more generally, for short and long term planning. Recently, small area estimates are employed for testing, the administrative records used for modern censuses (see Census). Although commonly known as “small area estimation” (SAE), the domain of studies may actually consist of socio-demographic subgroups as defined, for example, by gender, age and race, or the intersection of such domains with geographical location.

The problem of SAE is that the sample sizes in at least some of the domains of study are very small, and often there are no samples available for many or even most of these...