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The aim of the paper is to propose a small area estimation model for Theil Index, an entropy-based measure used to quantify economic inequality, industrial concentration and, in general, the disparity related to economic phenomena. We developed an area-level model of its relative index, i.e. Theil index over its maximum, which has a more manageable support between 0 and 1. Classical proposals in area-level context for measures on (0,1) are mostly based on proportions modelling and show limitations when dealing with asymmetric heavy-tailed data, such as in our case. We propose a model with alternative distributional assumptions based on a particular Beta mixture with unconstrained mean modeling, estimated under a Hierarchical Bayes approach. An application to IT SILC income data is provided, showing that our proposal yields a more flexible framework in comparison with Beta regression with unmatched sampling and linking models.
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EU-SILC-Bibliography
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Flexible Small Area Estimation of Theil Index using Mixture of Beta
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inproceedings
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SAE 2021 BIG4small - Book of short papers
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Bibsonomy
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In SAE 2021 BIG4small - Book of short papers, edited by Michele, D’Alò and Falorsi, Stefano and Fasulo, Andrea, 57-62, 2021
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European Union Statistics on Income and Living Conditions (EU-SILC)
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2021
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FDZ_GML
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SILC
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SILC_input2022
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SILC_pro
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english
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inproceedings
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jak
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text
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tmd
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transfer22
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