Small Area Estimation Using a Spatio-Temporal Linear Mixed Model

Abstract

In this paper it is proposed a spatio-temporal area level linear mixed model involving spatially correlated and temporally autocorrelated random effects. An empirical best linear unbiased predictor (EBLUP) for small area parameters has been obtained under the proposed model. Using previous research in this area, analytical and bootstrap estimators of the mean squared prediction error (MSPE) of the EBLUP have also been worked out. An extensive simulation study using time-series and cross-sectional data was undertaken to compare the efficiency of the proposed EBLUP estimator over other well-known EBLUP estimators and to study the properties of the proposed estimators of MSPE.