Small Area Estimation of Poverty

Table of ContentsPrefaceiiiTable of ContentsivExecutive Summaryv1. Introduction 12. Methodology 22.1 Small-area estimation ELL method 22.2 A note of caution 33. Data sources and description 43.1 NLSS III and 2011 Population Census 43.2 Common and comparable variables 43.3 Definition of “target area” 5Table 1: Estimation levels and population size 64. Results 74.1 Strata-level results in comparison with NLSS III 7Table 2: Predicted poverty rates on the target level - by stratum and in comparisonto NLSS III poverty rates 74.2. District, ilaka, and target-level results 8Table 3: Summary statistics of predicted poverty rates 94.3 Maps 95. How reliable are these maps? 135.1 Tests for over-fitting 13Table 4: Over-fitting test comparing observed and predicted FGT(0)in a subsample of the NLSS III survey 135.2 Breakdown of standard errors 146. Conclusions and suggestions for follow-up work 15References 16Appendix : Tables with small area estimations of poverty at thelevel of the district, target level (Municipality) ilaka, target-level(FGT0>0.505, and VDC. 17A 1: SAE Poverty Rates at the District level; Average and Standard Error 17A 2: SAE Poverty Rates at the Target level (Municipality);Average and Standard Error 19A 3: SAE Poverty Rates at the Ilaka level; Average and Standard Error 20A 4: SAE Poverty Rates at the “Target Area” having FGT0 > 0.505; Average and Standard Error 41A5 : SAE of target areas( having number of poor > 10,000) 45FiguresFigure 1: Belts and district boundaries of Nepal 5Figure 2: Poverty incidence on district level 10Figure 3: Number of poor (FGT(0)) on district level 10Figure 4: Poverty incidence on the ilaka level 11Figure 5: Number of poor (FGT(0)) on the ilaka level 11Figure 6: Poverty incidence on target-area level 12Figure 7: Number of poor (FGT(0)) on target-area level 12Figure 8: Standard error of FGT(0) by target area size (number of households) 14iv