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Variance Estimation of Change in Poverty Rates: an Application to the Turkish EU-SILC Survey

Author

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  • Oguz Alper Melike

    (University of Southampton, University Road Bldg. 58, Southampton SO17 1BJ, UK)

  • Berger Yves G.

    (University of Southampton, University Road Bldg. 58, Southampton SO17 1BJ, UK)

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 a change in the cross-sectional estimates. Standard estimators 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 require special treatment when estimating their variance. For example, poverty rates depend on poverty thresholds which are estimated from medians. We propose using a multivariate linear regression approach to estimate correlations by taking into account the variability of the poverty threshold. We apply the approach proposed to the Turkish EU-SILC survey data.

Suggested Citation

  • Oguz Alper Melike & Berger Yves G., 2015. "Variance Estimation of Change in Poverty Rates: an Application to the Turkish EU-SILC Survey," Journal of Official Statistics, Sciendo, vol. 31(2), pages 155-175, June.
    • Handle: RePEc:vrs:offsta:v:31:y:2015:i:2:p:155-175:n:2
    DOI: 10.1515/jos-2015-0012
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    References listed on IDEAS

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    2. Vijay Verma & Gianni Betti, 2011. "Taylor linearization sampling errors and design effects for poverty measures and other complex statistics," Journal of Applied Statistics, Taylor & Francis Journals, vol. 38(8), pages 1549-1576, August.
    3. Ian Preston, 1995. "Sampling Distributions of Relative Poverty Statistics," Journal of the Royal Statistical Society Series C, Royal Statistical Society, vol. 44(1), pages 91-99, March.
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