Jurnal Natural
Volume 23 Number 2, June 2023

Performance of copula and nested error regression models in estimating per capita expenditure of sub-district in Pidie Regency

NUR HASANAH (BPS-Statistics of Aceh Province
IPB University.)

KHAIRIL ANWAR NOTODIPUTRO (IPB University)
BAGUS SARTONO (IPB University)



Article Info

Publish Date
03 Jun 2023

Abstract

In unit-level small area estimation (SAE), the commonly used nested error regression (NER) model assumes normality which is not always the case. To handle non-normal data, researchers in statistics have developed a novel approach using exchangeable and extendible copula called the multivariate exchangeable copula (MEC) model. This study compares the performance of parametric MEC and NER models in estimating the sub-district average of per capita expenditure (PCE) in Pidie Regency, Aceh Province. This study presents PCE, which has a skewed distribution of the three-parameter skew-normal. The parametric MEC model uses a Gaussian copula from the Elliptical family and an empirical best unbiased prediction (EBUP) estimator. Meanwhile, the NER model uses an empirical best linear unbiased prediction (EBLUP) estimator. The results reveal that at a 95% confidence level, the parametric MEC model outperforms the NER model with a smaller root of mean squared error (RMSE) and provides a more precise estimate of the sub-district average of PCE. This study highlights the importance of considering the parametric MEC model as an alternative method for skewed data in unit-level SAE. The results of this study have the potential to support the achievement of Goal 1 (to end poverty) and Goal 10 (to reduce inequality) of the sustainable development goals (SDGs) by providing average PCE estimates at the sub-district level.

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Journal Info

Abbrev

natural

Publisher

Subject

Agriculture, Biological Sciences & Forestry Astronomy Biochemistry, Genetics & Molecular Biology Chemistry Earth & Planetary Sciences Energy Immunology & microbiology Neuroscience Physics

Description

Jurnal Natural (JN) aims to publish original research results and reviews on sciences and mathematics. Jurnal Natural (JN) encompasses a broad range of research topics in chemistry, pharmacy, biology, physics, mathematics, statistics, informatic and ...