Variance estimation of change of poverty based upon the Turkish EU-SILC survey

Oguz-Alper, Melike and Berger, Yves G. (2015) Variance estimation of change of poverty based upon the Turkish EU-SILC survey. Journal of Official Statistics, 1-30. (In Press)

Record type: Article

Abstract

Interpreting changes between point estimates at different waves may be misleading, if we do not take the sampling variation into account. It is therefore necessary to estimate the standard error of these changes in order to judge whether or not the observed changes are statistically significant. This involves the estimation of temporal correlations between cross sectional estimates, because correlations play an important role in estimating the variance of change in the cross-sectional estimates. Standard estimator for correlations cannot be used, because of the rotation used in most panel surveys, such as the European Union Statistics on Income and Living Conditions (EU-SILC) surveys. Furthermore, as poverty indicators are complex functions of the data, they need a special treatment when estimating their variance. For example, poverty rates depend on poverty thresholds which are estimated from medians. We propose to use a multivariate linear regression approach to estimate correlations by taking into account of the variability of the poverty threshold. We apply the proposed approach to the Turkish EU-SILC survey data.

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