Cost-Effective Estimation of the Population Mean Using Prediction Estimators

38 Pages Posted: 20 Apr 2016

See all articles by Tomoki Fujii

Tomoki Fujii

Singapore Management University - School of Economics

Roy van der Weide

World Bank; World Bank - Development Research Group (DECRG)

Date Written: June 1, 2013

Abstract

This paper considers the prediction estimator as an efficient estimator for the population mean. The study may be viewed as an earlier study that proved that the prediction estimator based on the iteratively weighted least squares estimator outperforms the sample mean. The analysis finds that a certain moment condition must hold in general for the prediction estimator based on a Generalized-Method-of-Moment estimator to be at least as efficient as the sample mean. In an application to cost-effective double sampling, the authors show how prediction estimators may be adopted to maximize statistical precision (minimize financial costs) under a budget constraint (statistical precision constraint). This approach is particularly useful when the outcome variable of interest is expensive to observe relative to observing its covariates.

Suggested Citation

Fujii, Tomoki and van der Weide, Roy, Cost-Effective Estimation of the Population Mean Using Prediction Estimators (June 1, 2013). World Bank Policy Research Working Paper No. 6509. Available at SSRN: https://ssrn.com/abstract=2285975

Tomoki Fujii (Contact Author)

Singapore Management University - School of Economics ( email )

90 Stamford Road
178903
Singapore
+6568280279 (Phone)
+6568280833 (Fax)

HOME PAGE: http://www.mysmu.edu/faculty/tfujii/

Roy Van der Weide

World Bank ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

World Bank - Development Research Group (DECRG)

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States

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