Poverty Mapping with Aggregate Census Data: What is the Loss in Precision?

Spatially disaggregated maps of the incidence of poverty can be constructed by combining household survey data and census data. In some countries (notably China and India), national statistics agencies are reluctant, for reasons of confidentiality, to release household-level census data, but they are generally more willing to release aggregated census data, such as village- or district-level means. This paper examines the loss in precision associated with using aggregated census data instead of household-level data to generate poverty estimates. The authors show analytically that using aggregated census data will result in poverty rates that are biased downward (upward) if the rate is below (above) 50%, and that the bias approaches zero as the poverty rate approaches zero, 50%, and 100%. Using data from Vietnam, it is found that the mean absolute error in estimating district-level poverty rates is 2.5 percentage points if the census data are aggregated to the enumeration-area level means, and 3-4 percentage points if the data are aggregated to commune or district level. Finally, the authors propose a method for reducing the error using variances calculated from the census. When this approach is applied to the Vietnam data, this method can cut the size of the aggregation errors by around 75%. Copyright United Nations University 2005.