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Special Problem

MUNICIPAL AND CITY LEVEL ESTIMATION OF POVERTY INCIDENCE IN


BICOL REGION

Reginald Plazo Arimado

2nd Semester, SY 2008-2009

Institute of Statistics
College of Arts and Sciences, University of the Philippines Los Baños

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INSTAT Catalog no. ____________

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University of the Philippines Los Baños
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Produced by the Institute of Statistics, College of Arts and Sciences


University of the Philippines Los Baños

CONTENTS
ABSTRACT …………………………………………………..…….4
1. INTRODUCTION …………………………………………..….5

2. REVIEW OF RELATED LITERATURE ……………………...7

3. THEORETICAL FRAMEWORK ……………………………..10

4. METHODOLOGY …………………………………………….15

Data Source…………………………………………………15

Estimation of Poverty Incidence……………………………16

Comparison of Estimates…………………………………...17

5. RESULTS AND DISCUSSION ………………………………17

Direct Estimation…………………………………………...17

Regression-Synthetic Estimation…………………………...21

EBLUP Estimation…………………………………………25

Comparison of Estimates…………………………………...27

6. SUMMARY AND CONCLUSION …………………………..31

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The special problem attached hereto entitled

MUNICIPAL AND CITY LEVEL ESTIMATION OF POVERTY INCIDENCE IN


BICOL REGION

prepared and submitted by

REGINALD PLAZO ARIMADO

In partial fulfilment of the requirements for the degree of BACHELOR OF SCIENCE in


STATISTICS is hereby accepted.

_______________________

Signature of Adviser

ZITA VJ ALBACEA, PH.D

Adviser

_______________

Date Signed

Accepted as partial fulfilment of the requirement for the degree of BACHELOR OF


SCIENCE in STATISTICS.

______________________

Signature of Director

EMETERIO S. SOLIVAS

Director, INSTAT

_______________

Date Signed

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MUNICIPAL AND CITY LEVEL ESTIMATION OF POVERTY INCIDENCE IN BICOL
REGION1

Reginald Plazo Arimado

ABSTRACT

Poverty incidence was used in order to determine the degree of poverty in the
municipalities and cities in Bicol Region. The 2003 Food and Expenditure Survey (FIES) was
utilized in obtaining the poverty incidence estimates. Three small area estimation procedures were
used in this study, namely: direct estimation, regression-synthetic and empirical best linear
unbiased predictor (EBLUP). The three procedures were assessed based on the measure of
precision and accuracy through the mean square error, and reliability through coefficient of
variation. Most of the poverty incidence estimates produced by the direct estimation were greater
than 50% and mean square errors greater than 0.0060. Also, only 36% of its valid estimates have
coefficient of variation at most 10%. The 2000 Census on Population and Housing was used in
the regression-synthetic technique in order to find a model that can predict poverty incidence. The
resulting predicting model has three predictors: proportion of persons with no grade completed,
proportions of households with at least 1 member aged within 1-6 years, proportion of housing
units with unfinished construction. This model has an adjusted R 2 of 53.80%. Most of the
predicted poverty incidences range from 40 to 50%. In terms of precision, majority of the
estimates have at most 0.002 mean square errors. Also, majority of the estimates are reliable,
where 81 out of 115 have coefficients of variation at most 10%. EBLUP method generated
estimates that are mostly greater than 50% with mean square error greater than 0.006. Most of the
estimates are unreliable. Regression-synthetic estimation has generated the “best” set of estimates
since it has produced the most number of precise, accurate and reliable estimates.

Keywords: direct estimation technique, regression-synthetic, empirical best linear unbiased


prediction

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Undergraduate Special Problem under the supervision of Zita VJ Albacea, Ph. D, submitted as partial fulfillment of
the requirements in STAT 190-Special Problem, 2nd Semester, School Year, 2008-2009

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I. INTRODUCTION

Bicol Region which is famous for having a perfectly cone Mount Mayon has six

provinces, namely; Albay, Camarines Norte, Camarines Sur, Catanduanes, Masbate and

Sorsogon The Bicol Region despite of its rich natural resources and God given beautiful scenery

is also well known to suffer badly from poverty. Studies conducted by the National Statistical

Coordinating Board (NSCB) showed that Bicol Region rank second in 2000 and is consistent in

the top ten poorest region in the Philippines for years (Official website of NSCB, July 2008).

Poverty is a universal problem and is most common among third world countries.

Countries like Philippines most likely to suffer from poverty at a higher degree since the ability of

the government to response to this problem is hindered by insufficiency of funds. Poverty is

defined as the condition of being poor with respect to money and goods (New Webster’s

Dictionary). Poverty is characterized by hunger, lack of shelter, lack of money for hospitalization,

inaccessibility of education, and unemployment.

The problem here in the Philippines is not getting any better. Past results of the study

conducted by NSCB alarmed the authorities because of the significant increase in the poverty

incidence for families by 2.3% in a span of three years (Official website of NSCB, July 2008).

This would translate to hundreds or thousands or even millions of Filipino people who are

struggling to meet their everyday needs. The government is still trying its best to minimize

poverty by implementing poverty-reduction programs. The main concern in implementing these

programs is on what areas are to be prioritized in providing the needed support. These can be

answered by determining the number of people who are “poor” across different areas in the

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country. Poor refers to households whose incomes fall below the poverty threshold, wherein

poverty threshold refers to the minimum income/expenditure required for a family/individual to

meet the basic food and non-food requirements (NSCB, 2008).

Government institutions have been conducting study that will give estimates of provincial

and regional level of poverty incidence. However, municipal and city level estimates is more

relevant today in order to determine specific areas which need more attention. In order to obtain

reliable estimates on a lower domain, sample size must be increased; however this will result to

an additional cost and worst, the non-sampling errors will go up.

An alternative technique which would not require to increase the sample size yet will

produce a reliable and precise set of estimates is the small area estimation technique. Through the

use of small area estimation, the problem of obtaining a set of precise and reliable estimates in

municipal level without increasing the cost of the study will be resolved. Through this, the local

government and other institutions can easily identify the areas which need more help and

assistance. This would result to proper allocation of resources and the target beneficiaries of the

program will be properly identified. Thus poverty reduction program will be efficient.

In general, the study aims to estimate municipal and city level poverty incidence in Bicol

Region. Specifically, the study aims to:

1. estimate poverty incidence of Bicol Region at the municipal and city level using direct

and indirect techniques such as regression-synthetic and empirical best linear unbiased

prediction estimation (EBLUP);

2. assess the estimates obtained in (1) based on measures of precision, accuracy and

reliability;

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3. compare the estimates obtained in (1) using different estimation techniques; and

4. recommend the “best” set of estimates to use.

II. REVIEW OF RELATED LITERATURE

Poverty is a worldwide problem and every country is trying to put a solution to this by

implementing poverty-reduction programs. These programs will only be effective if government

can rightly identify the people who can be considered poor. With this in mind, the government

implemented the basis on how can a person in a family be considered “poor.” In the Philippines,

food threshold and poverty threshold are the reference of identifying poor people. Food threshold

is a measure of food needs and people below this line can be considered as food poor. On the

other hand, poverty threshold is used to identify the people that cannot afford to buy basic

necessity in life.

Albacea (2004) applied three techniques in implementing small area estimation and these

are design-based, model-based and empirical best linear unbiased predictor (EBLUP) in

determining the provincial/city poverty incidence in the Philippines. The results of the study

showed that among the three techniques, EBLUP turned out to give the best set of estimates since

it gave the most number of reliable, precise and accurate estimates. Five variables were included

in the predicting model and these were: proportion of provincial population whose household

head is a married male person and had reached at least secondary education, provincial

dependency ratio, provincial population density, average household size of a province, and

enrolment in private schools of a province in secondary education.

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Abarintos (2005) also focused on poverty using consumption-based measures. The results

of the study showed that the national level estimate of poverty incidence is 19.46% or about 20

out of 100 Filipinos are poor. In addition, using the computed per capita poverty threshold of Php

8,960.25 the estimated number of poor households at the national level is 2,971,305. The highest

estimated number of poor households is that of Bicol which accounts to 36.83%.

Cabrera (2005) estimated the food poverty incidence at the provincial level in the

Philippines. In determining the estimates, three techniques on small area estimation were used

which were design-based estimation, model-based estimation and empirical best linear unbiased

predictor (EBLUP). The results of the study showed that model-based estimation gave the best set

of estimates since it has the most number of reliable, precise and accurate estimates of food

poverty incidence. Three predictors were included in the model and these were the provincial

proportion of the total number of barangays with the surroundings as waste disposal system,

provincial proportion of the total number of barangays which have electric power and provincial

average number of housing units with roof made of light materials. The model has an adjusted R 2

of 38.93%. Also, the study found that 13.14% of the Filipino households are food poor.

Donceras (2005) focused on estimating the proportion of women in the labor force at the

municipality level in CALABARZON Region. In acquiring estimates, direct, model-based and

EBLUP estimation technique were applied. Three predictors were found to be included in the

resulting model, namely: proportion of household head who are college graduate to the total

number of household heads in the municipality, proportion of recreational establishments present

in the municipality to the total number of establishments and proportion of barangays in the

municipality that has elementary schools. Moreover, EBLUP turned out to give the “best” set of

estimates since it yielded the most number of precise and reliable estimates.
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Similarly, Magistrado (2005) worked on estimating the participation rate of women in the

labor force at the municipal level in the Bicol Region. Design-based, model-based and EBLUP

were used as the primary tool of obtaining estimates in the municipal level. Only two predictors

comprised the resulting model and these were: percentage of female who are disabled out of the

total municipal population and percentage of dwelling units in a municipal built from year 1971 to

1980. Likewise, EBLUP was found to give the “best” set of estimates.

Sotto (2006) worked on the proportion of underweight children aged 0 to 5 years at the

provincial level in the Philippines. In estimation, three techniques on small area estimation were

used namely: design-based, model-based and empirical best linear unbiased predictor. Among the

three techniques, model-based estimation gave the best set of estimates since it produced the most

number of reliable and precise estimates .The predicting model obtained was consist of three

predictors, namely; provincial proportion of the total number of nurses in the local government

unit to the population, provincial proportion of households with members aged between 7 and 14,

and provincial proportion of housing units with floor area at most 10 square meters. Moreover,

the results of the study showed that Bicol Region is the worst off region having 37.83% of

estimated underweight pre-school aged-children.

Perez (2007) likewise worked on poverty and specifically estimated the different poverty

measures at the provincial level in the Philippines. Design-based, model-based estimation and

empirical best linear unbiased predictor (EBLUP) were used to come up with the poverty

incidence, poverty gap, and severity of poverty estimates. The resulting predicting model was

composed of three predictors which were provincial proportion of the number of housing units

with floor area at most 10 square meters, provincial proportion of the number of households with

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members aged less than 7 and provincial proportion of barangays with the surrounding as waste

disposal system. The results of the study showed that the average provincial poverty incidence is

40%.

Amar (2007) also estimated the proportion of underweight children aged 0 to 5 years old

but specifically estimated at the barangay level. Direct, model-based and empirical best linear

unbiased predictors were used to come up with the estimates. In comparing the three techniques,

model-based technique turned out to give the best set of estimates for underweight children since

it produced the most number of reliable and precise estimates. Six predictors were included in the

predicting model namely: barangay proportion of housing units with outer walls made of strong

materials, barangay proportion of household headed by a person with no spouse, barangay

proportion of household with at least one member aged less than 1 year, barangay proportion of

household headed by a person who completed 6th grade, whether or not there are from 1 to less

than 10 restaurants in the barangay and provincial ratio of the number of trained birth attendants

to the population.

III. THEORETICAL FRAMEWORK

Direct Estimation of Poverty Incidence in Municipal/City Level

A direct estimator is based only on the data obtained from the sample units in the area of

interest. In this study the FIES 2003 was used to obtain the direct estimates of poverty incidence

of municipalities and cities in the Bicol Region.

Poverty incidence is the proportion of poor households out of the total number of families

in the municipality or city. A household can be determined poor if his total income falls below the

established poverty threshold.

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The direct estimator of the poverty incidence is given by:

∧ NPi
Pi = ∧
x100%
Ni

th
where Pi is the i municipal/city direct estimator

th
NPi is the total number of poor households in the i municipality or city; and

Ni Is the total number of households in the ith municipality or city.

∧ ∧
NPi and N i can be computed as:
∧ ni nk ∧ ni nk
NPi = ∑∑
k= 1 j= 1
w jkiY jki and N i = ∑∑
k = 1 j= 1
w jki X jki

where ni is the total number of barangay in the ith municipality or city;


wjki is the survey weight in the jth household in the kth barangay in the ith municipality or
city;
Xjki is equal to 1 means the inclusion of the in the jth household in the kth barangay in the
ith city or municipality, 0, otherwise;
Yjki is equal to 1 if the household in the jth household in the kth barangay in the ith city or
municipality is poor, 0, otherwise; and
nki is the number of household in the kth barangay in the ith municipality/city;

The precision and reliability of the estimate generated by the direct estimator is measured

by computing its bias, mean square error and coefficient of variation. Albacea(1999) in her study,

derived an expression for the variance estimator of Pˆi , which is given as:

1  ∧
∧ ∧ ∧ 2 ∧ ∧ ∧
 ∧ ∧ ∧

var( Pi ) =  var( NP i ) + Pi var( N i ) − 2 P i  cov( NP i , N i )  
∧ 2
Ni  
∧ ∧
The variance, covariance of NPi and N i are computed according to the sampling design of 2003
∧ ∧ ∧ ∧ ∧ ∧ ∧
FIES. The var( Npi ) , var( Ni ) and cov( Npi , Ni ) can be computed as:

ni ∧

 ∧ 
∑ ( NP ki − NPi )2
var  NPi  = k= 1 , variance of the total poor households in the ith municipality/city
ni
 

k= 1
ni (ni − 1)

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ni ∧

 ∧ 
∑ ( N ki − N i )2
var  Ni  = k=1
ni
, variance of total households in the ith municipality/city, and
 

k=1
ni (ni − 1)

ni

∑ ˆ − NP i )( Nˆ − N )
(NPki ki i
ˆ , Nˆ ) =
cov( NP k=1
, covariance of the total poor households and total
i i ni


k= 1
ni (ni − 1)

households in the ith municipality/city

∧ ∧
Also, N ki , N i , NP ki , NP i can be computed as :

∧ nki
N ki = ∑j= 1
th
w jki X jki , total households in the k barangay

ni ∧

th
Ni = N ki ni , mean of households in the i municipality
k=1

∧ nki
NP ki = ∑
th
w jkiY jki , total of poor households in the k barangay
j= 1

ni ∧
NP i = ∑
k=1
NP ki ni
, mean of poor households in the ith municipality

The estimator is considered as a ratio estimator. According to Cochran (1997), the ratio

estimate is generally biased but bias becomes negligible as the sample size increases. The bias of

the estimate is measure as:


 ∧ ∧ ∧ 
∧ ∧ ∧
 var( N i ) cov( NPi , N i ) 
bias( Pi ) = Pi  −
∧ 2 ∧ ∧  .
 N i
NP i N i 

The mean square error of the estimate is

 ∧ ∧ 2
∧ ∧ ∧ ∧ ∧ ∧ 
∧ ∧
 var( NP ) var( N ) 2 cov( NP , N i)
mse( Pi ) = Pi i
+ i
− i
. 12
 ∧ 2 ∧ 2 ∧ ∧ 
 NPi Ni NP i N i 
The coefficient of variation can be obtained using


∧ mse( Pi )
cv( Pi ) = ∧
× 100%.
Pi

Regression Synthetic Estimation of Poverty Incidence in Municipal/City Level

Variables that are highly correlated with the poverty incidence were regressed with the

direct estimates. This method possesses some advantages over the other estimating techniques.

The resulting model can be validated from the sample data. Also, this method can handle complex

cases like time series data.

The regression synthetic model is composed of two components

Pˆi = Pi + ei

where P i is the direct estimator and ei are the sampling errors which are assumed to be independ-

dent across cities or municipalities with means 0 and known variance σ ei . Another component of
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the model is a linking model which relates to municipal or city level auxiliary variables through a

linear regression model:

Pi = xi β% + vi

where the model errors are assumed to be independent across municipalities or cities with means

0 and common variance σ 2


v and independent of ei and β is the p-vector of regression parameters.

Combining the two components, the resulting model is given by:



P i = xiT β + vi + ei

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which is of the form of a linear mixed effects model with fixed effects β and random small area

effects ei.

The regression synthetic method uses the weighted least square estimator instead of the

ordinary least square estimator. It is given by :


−1
 x xT   x Pˆ 
β% =  ∑ 2 i i   ∑ 2 i i 
 σ v +ψ i  σ v +ψ i

Thus, the regression-synthetic estimate is computed as:

P%i = xi β% .

A measure of precision related with the regression-synthetic estimator is given by:

MSE ( P%i ) = MSE  xiT ( xiT xi ) − 1 xi 

where the mean square error (MSE) is obtained from the model-building process and xi is the

vector of observed values of the auxiliary variables for the ith city or municipality. Moreover, the

coefficient of variation of the estimate, which is the measure of reliability, can be computed as:

MSE ( P%i )
cv( P%i ) = × 100%.
P% i

Empirical Best Linear Unbiased Prediction (EBLUP) Estimation of Municipal/City Level


Poverty Incidence

The EBLUP method is applicable for linear mixed models. The BLUP estimator of the

realized Pi is the estimator with the minimum MSE in the class of LUP estimators. Prasad and

Rao (1990) gave the BLUP estimator of the Pi :

Pˆi H = γ i Pˆi + (1 − γ i ) P%i



where Pˆi H is the EBLUP estimator, P i is the direct estimate, P%i is the regression-synthetic
σ 2
estimate and γ i = . A simple moment estimator is used for estimating σ
v 2
v which is
σ +ψ
2
v i

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defined as:
σ 2

σ% v 2 = max( v ,0)

 
1  m ∧2 m
with σ% v 2
= ∑ vi − ∑ σ 2
(1 − hii )  where p is the total number of predictors, m is the
m − p  i = 1 
ei
i= 1
 
m
total number of provinces, v i is the regression synthetic residuals and hii = xi [ ∑
∧ T
xi xiT ]-1.
i= 1
Albacea (1999) cited that the σ 2
v
is an unbiased estimator where its variance is computed
as:
∧ 2 m ∧ 2
Var (σ v ) = V (σ% v 2 ) ≅ 2m − 2 ∑ (σ v +σ ec
2 2
)
c= 1

∧ H
The approximate mean square error of P i is

∧ 2 ∧ 2 ∧ 2
mse( Pˆi H ) = g1i (σ v ) + g 2 i (σ v ) + 2 g3i (σ v )

where

∧ 2
g1i (σ v ) = γ iσ ei ,
. −1
2  m 

2 T  xi xi T 
g 2i (σ v ) = (1 − γ i ) xi ∑ xi , and
 i= 1 ∧ 2 
 σ v + σ ei 
2

−3
∧ 2
∧ 2
 ∧ 2
g3i (σ v ) = (σ ei ) σ
2 2
v +σ ei
2
 V (σ v )
 
∧ H
A measure of the reliability of the P i is computed as :

∧ H
∧ H mse( P i )
cv( P i ) = × 100%
∧ H
Pi

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IV. METHODOLOGY

Data Sources

This study made use of the 2003 Family Income Expenditure Survey (FIES) and census

data through Census of Population and Housing (CPH). The 2000 Census of Population and

Housing was specifically utilized to obtain the total population and housing units in the

Philippines as well as it provided their demographic, social, economic cultural and structural

characteristics.

The (FIES) which is a nationwide survey of households conducted by the National

Statistical Office (NSO) every three years was used in order to obtain information in estimation of

poverty incidence. The data from this survey mainly deal with the family income and expenditure

by item expenditures. The sampling design of 2003 FIES uses the 2000 Master Sample for

household surveys. Moreover, 2003 FIES considers the administrative regions as its sampling

domain.

Estimation Procedures:

Poverty incidence was estimated by first determining whether a household is poor or not.

A household whose per capita annual income falls below the poverty threshold was considered

poor. Poverty incidence was then estimated by getting the proportion of poor households.

Direct estimation procedure was employed. This was done by generating poverty

incidence rate at the municipal and city level in Bicol Region, the ratio of the total number of poor

and total number of households per municipality and city was computed.

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Indirect estimation procedures specifically the regression-synthetic method and empirical

best linear unbiased predictor (EBLUP) were used to obtain estimates of poverty incidence. The

regression-synthetic procedure made use of variables that were highly correlated with poverty

incidence. These variables were regressed to the direct estimates. The resulting model was

assessed through the measure of the adequacy of the model and whether the underlying

assumptions of the linear regression model are satisfied or not.

EBLUP combined the direct and the regression-synthetic estimates. This technique made

use of a weight which is equal to the ratio of the variance due to modeling to the sum of variances

due the sampling and modeling process.

Comparison of Estimates

Mean square error (MSE) was used to measure the accuracy and precision of the

estimates. The smaller the MSE of an estimate, the more precise and accurate the estimate is.

Moreover, coefficient of variation was the measure of the reliability of the estimate. Estimates

that have coefficient of variation equal or less than 10% was considered reliable. The estimation

procedure which produced the most number of reliable and precise estimates was considered as

the estimation technique which provides the “best” set of estimates.

V. RESULTS AND DISCUSSIONS

Direct Estimates of the Municipal/ City Level Poverty Incidence in Bicol Region

In 2003, Bicol Region ranks fourth as the poorest region in the Philippines. The region’s

poverty incidence is estimated to be 40.5%. Bicol region together with its provinces is consistent

17
in the poorest area in the Philippines.

Table 1 shows the distribution of estimates of poverty incidence of the 48 valid municipal/

city estimates in Bicol region. Among the 115 municipalities, only 48 of them are considered

valid since only these municipalities have an estimate of positive variance and mean square error.

Some estimates do not have a measure of variability since only one barangay was sampled in

some municipalities. Also, when a municipality has zero estimate of poverty incidence, no

variance can be computed. Furthermore, some estimates may have negative variances. This may

happen when the covariance exceeds the variance of the estimates.

Table 1. Distribution of direct municipal/city estimates of


poverty incidence in Bicol.
Poverty Incidence Frequency Percentage
At most 10.00 0 0
10.01-20.00 3 6.25
20.01-30.00 11 22.92
30.01-40.00 6 12.5
40.01-50.00 12 25
>50.00 16 33.33
Total 48 100

The municipal poverty incidence in Bicol region ranges from 10.34% to 79.31%.

Camaligan in Camarines Sur obtained the smallest poverty rate. Also shown in the Table 1 that no

municipality has an estimate of at most 10% and only about 7% of the total valid estimates fall

within the 10.01% to 20.00% poverty incidence estimate. This means that only a small number of

municipalities/cities has a small estimate of poverty incidence. On the other hand, 12 of the 48

municipalities/cities have 40-50% poverty incidence rate. Also, there are 16 municipalities that

has more than 50% poverty incidence estimate. This indicates that out of the 10 households, about

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5 to 8 of them are poor and the municipalities or cities included in these intervals should be

prioritized by the poverty reduction program of the government.

The mean square error of the direct estimates ranges from 0.00001 to 0.06268. Table 2

shows that majority of the direct estimates have mean square error that are greater than 0.006,

accounting to about 63% of the total valid estimates. This implies that these estimates are less

precise and accurate. Moreover, it can also be noticed that there are only 10 direct municipalities/

cities estimate that has mean square error from 0.0 to 0.0020. This indicates that estimates falling

in this interval are more precise and accurate. In general, the mean square errors are small, but it

should be noticed that the proportion of poverty incidence ranges only from 0 to 1. This may

mean that large value of mean square error may appear small but in fact large enough to be

considered not precise. Small mean square error may be relatively high to some estimates and it

will be reflected to the coefficient of variations of the estimates.

Table 2. Distribution of mean square error of the direct municipal/


city estimates of poverty incidence in Bicol Region.
Mean Square Error Frequency Percentage
0.0000-0.0020 10 20.83
0.00201-0.0040 5 10.41
0.00401-0.0060 3 6.25
>0.0060 30 62.5
Total 48 100

The coefficient of variation of the direct estimates ranges from 0.01% to 37.92%. It can be

seen from Table 3 that 17 of 48 valid estimates have coefficient of variations that are at most

10%. Municipalities belonging to this interval have an estimate that can be considered as reliable.

Moreover, about 28% of the valid estimates have coefficients of variation that are greater than

20%. This implies that these estimates are not reliable estimate.
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Table 3. Distribution of coefficient of variation of the direct
municipal/city estimates of poverty incidence in Bicol Region.
Coefficient of
Variation Frequency Percentage
0.00-10.00 17 35.42
10.01-20.00 18 37.5
>20.00 13 27.08
Total 48 100

It is shown on Table 4 that the poorest municipality in Bicol is from the province of

Albay, specifically Pio Duran with a poverty incidence of about 80%. It can also be noticed that

the top four municipalities has indeed a severe degree of poverty for their poverty incidence

estimates is at least 70% which is very alarming. This means that at least 70% of the households

in these areas are considered poor. Furthermore, among the ten municipalities, four of them came

from the province of Camarines Sur, this suggest that Camarines Sur is also suffering from severe

degree of poverty. Moreover, two of the municipalities of Masbate are also included in the top ten

where Placer and Monreal ranked 2nd and 8th respectively. Labo and Sta. Elena which are from the

province of Camarines Norte are also part of the top ten poorest municipalities.

The bias of the estimates is quite small. Most of the variance and mean square errors of

the top ten estimates are small which suggest that they are precise and accurate. This is supported

by the coefficient of variation of the estimates for there are only two estimates of the top ten that

are not reliable.

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Table 4. Top ten poorest municipalities/cities with poverty incidence using direct estimation.
Poverty
Municipal Incidence
Rank Province Name Name (%) bias Variance MSE CV(%)
1 Albay Pio Duran 79.31 -0.0002 0.00005 0.00005 0.80
2 Masbate Placer 78.57 0.0059 0.00167 0.0017 4.70
3 Camarines Sur Baao 77.81 0.0258 0.01379 0.01445 13.63
4 Camarines Sur Pasacao 70.57 0.0057 0.00326 0.00329 6.80
5 Camarines Sur Lupi 68.74 -0.005 0.00673 0.00676 9.90
6 Camarines Norte Santa Elena 66.67 0.0025 0.00653 0.00654 9.90
7 Camarines Sur Garchitorena 66.67 0.0024 0.00653 0.00654 9.90
8 Masbate Monreal 60.00 -0.0006 0.00026 0.00026 2.07
9 Albay Bacacay 59.38 0.0043 0.00467 0.00469 8.87
10 Camarines Norte Labo 57.88 0.0699 0.00783 0.01272 14.82

Regression-Synthetic Estimates of the Municipal/ City Level Poverty Incidence in Bicol


Region

Table 5 shows the coefficient of the predictors of the resulting predicting model with their

corresponding standard error and p-value. The model was constructed using the weighted least

square with weights equal to the reciprocal of the total variance due to both sampling and

modeling process. The resulting predicting model obtained an adjusted R2 53.80%, which

translates to the total variation in the proportion of poor households that can be explained by the

predictors. All of the assumptions of regression model was satisfied and all the p-value suggest

that all the predictors are significant at 5% level of significance. The proportion of persons with

no grade complete was found to have direct relationship with poverty since education is the

primary weapon against poverty. Moreover, the proportion of households with at least 1 member

aged 1-6 years also contribute to poverty, this may be brought about by the fact that children

within these age group do not help contribute to family income. Also, children within this age

group have a lot of demand for expenses, such as milk and health problem expenses. Lastly, the

21
proportion of housing units with unfinished construction has also direct relationship with poverty

since unable to continue the construction of a house would mean less money for non-basic needs

expenditures.

Table 5. Estimated regression coefficients of the predicting model for the municipal/
city poverty incidence using the weighted least squares method.
Predictors Estimated Standard Error p-value
Coefficient
proportion of persons with
no grade completed 4.67 1.7 0.0090

proportions of households
with at least 1 member 2.93 0.746 0.0000
aged within 1-6 years
proportion of housing units
with unfinished 0.97 0.407 0.0220
construction
Constant -1.35 0.35 0.0000

Using the predicting model, poverty incidence estimates are generated for all the 115

municipalities. The poverty incidence in Bicol region ranges from 6.36% to 70.99%. San

Fernando in Masbate has the smallest poverty incidence rate of 6.36%. Table 6 shows that there is

only one municipality that has at most 10% poverty incidence estimate. In addition only 6 of the

115 municipalities/cities has poverty incidence from 10 to 20%. This indicates that only a small

number of municipalities/cities have a small poverty incidence. On the other hand, 34 of the 115

municipalities/cities has poverty incidence that is greater than 50%. These municipalities have a

very alarming rate of poverty incidence.

22
Table 6. Distribution of regression synthetic municipal/city
estimates of poverty incidence in Bicol Region.
Poverty Incidence Frequency Percentage
At most 10.00 1 0.87
10.01-20.00 6 5.22
20.01-30.00 13 11.30
30.01-40.00 24 20.87
40.01-50.00 37 32.17
>50.00 34 29.57
Total 115 100

It can be seen in Table 7 that an overwhelming majority of the regression synthetic

estimates has a mean square error ranging from 0 to 0.00200, accounting to about 82% of the

estimates. This indicates that majority of the regression synthetic estimates are precise and

accurate.

Table 7. Distribution of mean square error of the regression synthetic


municipal/city estimates of poverty incidence in Bicol Region.
Mean Square Error Frequency Percentage
0.0000-0.0020 94 81.74
0.00201-0.0040 17 14.78
0.00401-0.0060 4 3.48
Total 115 100

In terms of the reliability of the estimates, Table 8 shows the distribution of the coefficient

of variation of the regression synthetic estimates. The coefficient of variation of the estimates

ranges from 3.99% to 94.98%. It can also be seen from the table that majority of the estimates

have coefficients of variation ranging from 0 to 10%, accounting to about 71% of the valid

estimates. These estimates are reliable estimates.

23
Table 8. Distribution of coefficient of variation of the regression
synthetic municipal/city estimates of poverty incidence
in Bicol Region.

CV Frequency Percentage
0.00-10.00 81 70.43
10.01-20.00 26 22.61
>20.00 8 6.96
Total 115 100

Table 9 shows that the top three poorest municipalities came from the province of

Masbate, where Mobo, Cawayan and Placer has a poverty incidence of about 71%. This indicates

that 7 out of 10 households are poor on these areas. It can also be noticed that five of the ten

municipalities is from Masbate. The other municipalities in the top ten came from Camarines Sur

and Albay. The mean square errors of the top ten municipalities are generally small which

indicates that the estimates are precise and accurate. Also, only one of the estimate in the poorest

municipalities has an unreliable estimate.

Table 9. Top ten poorest municipalities/cities with poverty incidence using regression-synthetic
estimation.
Municipal Poverty
Rank Province Name Name Incidence(%) MSE CV(%)
1 Masbate Mobo 70.99 0.00164 5.71
2 Masbate Cawayan 70.45 0.00387 8.83
3 Masbate Placer 70.29 0.00483 9.89
4 Camarines Sur Garchitorena 69.55 0.00262 7.36
5 Masbate Milagros 64.77 0.00112 5.17
6 Masbate Aroroy 64.53 0.00183 6.62
7 Camarines Sur Del Gallego 62.27 0.00156 6.35
8 Camarines Sur Pamplona 62.09 0.00098 5.05
9 Albay Rapu-rapu 60.58 0.00159 6.57
10 Albay Tiwi 58.93 0.00388 10.57

24
EBLUP Estimates of the Municipal/ City Level Poverty Incidence in Bicol Region

Empirical best linear unbiased estimator combines the direct and regression synthetic

estimates using a certain weight. Thus, out of the 115 municipalities, only 48 of them were

generated since only 48 estimates were generated using the direct estimation procedure. The

EBLUP poverty incidence estimates ranges from 10.77% to 79.23% where the smallest poverty

incidence rate is from Camaligan in Camarines Sur. Table 10 shows that only 3 of 48

municipalities has a poverty incidence of at most 20%. On the other hand, 17 of 48 municipalities

have a poverty estimate of greater than 50%.

Table 10. Distribution of EBLUP municipal/city estimates of


poverty incidence in Bicol Region.
Poverty Incidence Frequency Percentage
At most 10.00 1 0.87
10.01-20.00 2 4.17
20.01-30.00 11 22.92
30.01-40.00 5 10.42
40.01-50.00 13 27.08
>50.00 17 35.42
Total 48 100

The mean square error of the estimates ranges from 0.00001 to 0.013. It is very evident

that the mean square errors of the EBLUP estimates are relatively large for most of its estimates

have mean square errors of more than 0.00600. Only 11 of the 48 municipalities have a mean

square error of at most 0.00200 which indicates that these estimates are more precise and

accurate.

Table 11. Distribution of mean square error of the EBLUP


municipal/city estimates of poverty incidence in Bicol

25
Region.
Mean Square Error Frequency Percentage
0.0000-0.0020 11 22.92
0.00201-0.0040 6 12.50
0.00401-0.0060 8 16.67
>0.0060 23 47.92
Total 115 100

The coefficient of variation of the EBLUP estimates ranges from 0.01% to 43.60%. It can

be seen from Table 12 that majority of the estimates are unreliable since their coefficients of

variation are greater than 10%. Only 9 of 48 municipalities have coefficients of variation of at

most 10% and this indicates that these estimates are reliable.

Table 12. Distribution of coefficient of variation of the EBLUP


municipal/city estimates of poverty incidence in Bicol
Region.
CV Frequency Percentage
0.00-10.00 9 18.75
10.01-20.00 18 37.50
>20.00 21 43.75
Total 48 100

Table 13 shows that the poorest municipality in Bicol is Pio Duran in Albay with an

estimate of about 80% poverty incidence. This means that for every 10 households, 8 of them are

poor. It can also be noticed that among the ten municipalities/cities, five of them is from the

province of Camarines Sur; these are Pasacao, Gachitorena, Lupi, Baao and Minalabac. This

indicates that there is severe poverty in the province of Camarines Sur. Some of the

municipalities/cities in Masbate are also included in the top ten. Most of the mean square errors of

the top ten estimates are precise and accurate but in terms of reliability, only five of them have

coefficient of variation that is at most 10%.

26
Table 13. Top ten poorest municipalities/cities with poverty incidence using EBLUP estimation.
Poverty
Rank Province Name Municipal Name Incidence(%) MSE CV(%)
1 Albay Pio Duran 79.23 0.00005 0.90
2 Masbate Placer 77.83 0.00159 5.12
3 Camarines Sur Pasacao 67.87 0.00281 7.81
4 Camarines Sur Garchitorena 67.6 0.00503 10.49
5 Camarines Sur Lupi 65.31 0.00499 10.82
6 Camarines Sur Baao 63.02 0.00786 14.07
7 Camarines Norte Santa Elena 61.32 0.00485 11.35
8 Masbate Aroroy 60.5 0.01276 18.67
9 Masbate Monreal 59.84 0.00025 2.66
10 Camarines Sur Minalabac 57.38 0.00047 3.79

Comparison of Estimates

In comparing the ranks of the poorest municipalities/cities, Table 14 shows that the top ten

of the direct estimation procedure is almost the same on the EBLUP technique. Although Bacacay

and Labo is not part of the direct poorest municipalies/cities, both the direct and EBLUP have the

same set of municipalities except that they are ranked differently. On the other hand, the

regression synthetic have produced a different set of poorest municipalities/cities except for

Placer and Garchitorena which are also included in the top ten list of direct estimation procedure.

27
Table 14. Ranking of municipal/city level estimation of poverty incidence
using direct, regression-synthetic and EBLUP technique.
Regression
Province Municipality Direct Synthetic EBLUP
Albay Pio Duran 1 13 1
Masbate Placer 2 3 2
Camarines Sur Baao 3 53 6
Camarines Sur Pasacao 4 26 3
Camarines Sur Lupi 5 17 5
Camarines
Norte Santa Elena 6 45 7
Camarines Sur Garchitorena 7 4 4
Masbate Monreal 8 36 9
Albay Bacacay 9 55 12
Camarines
Norte Labo 10 58 15

Table 15 shows that the top ten ranking of direct and EBLUP estimation procedure are

significantly correlated with each other at alpha 1% and 5%. Likewise, regression-synthetic’s top

ten ranking are significantly related with those of the EBLUP estimation procedure. This suggest

that as the rank of a municipality in the top ten ranking of direct goes up, the rank of that

municipality will also goes up in the EBLUP technique. Same happens with the relationship of

the top ten rankings of regression-synthetic and EBLUP estimation procedure.

Table15. Summary results of test of relationships of the


top ten rankings of direct, regression-synthetic and
EBLUP technique.
Estimation spearman
Procedure rho p-value
Direct against
Regression 0.6242 0.0537
Direct againts
EBLUP 0.8788 0.0008
Regression against
EBLUP 0.8667 0.0012

28
The three estimations have produced different set of estimates. Table 15 shows that all of

them have very small percentage on municipalities having at most 20% poverty incidence rate.

Also, Figure 1 shows that the bulk of the distribution of the three estimation techniques falls on

the interval of 40 to 50% and greater than 50% poverty incidence. This suggests that all the

estimation procedures have produce large estimates of poverty incidence which shows that

poverty problem in Bicol Region is very serious.

Table 16. Distribution of municipal and city Figure 1.Comparison of municipal and city estimates
estimates of poverty incidence using of direct, regression synthetic and
direct, regression-synthetic and EBLUP EBLUP methods.
methods.

Poverty Regression
Incidence Direct Synthetic EBLUP
At most
10.00 0.00 0.87 0.87
10.01-20.00 6.25 5.22 4.17
20.01-30.00 22.92 11.30 22.92
30.01-40.00 12.50 20.87 10.42
40.01-50.00 25.00 32.17 27.08
>50.00 33.33 29.57 35.42
Total 100.00 100.00 100.00

Table 16 shows that only the regression synthetic technique has produced a large

percentage of estimates that has mean square error of at most 0.00200. In Figure 2, it is very

evident that both the direct and EBLUP techniques have produced relatively large value of mean

square error. This indicates that among the three estimation procedures, regression synthetic

procedure has produced the most precise and accurate set of estimates.

29
Table 17. Distribution of mean square error of Figure 2. Comparison of mean square error of
municipal/city estimates of poverty municipal/city estimates of direct,
incidence using direct, regression-synthetic regression and EBLUP methods.
and EBLUP methods.

Mean Square
Error Direct Regression EBLUP

0.0000-0.002 20.83 81.74 22.92


0.00201-0.004 10.41 14.78 12.5
0.00401-0.006 6.25 3.48 16.67
>0.006 62.5 0.00 47.92
Total 100 100 100

In terms of the reliability of the estimates, Table 16 shows that regression synthetic

estimation procedure have produced the most number of reliable estimates, accounting to about

71% of its estimates. On the other hand, Figure 3 shows that most of the estimates of the direct

and EBLUP synthetic estimation technique are not reliable, for most of their estimates have

coefficient of variation that is greater than 10%.

Table 18. Distribution of coefficient of Figure 3. Comparison of coefficient of variation


variation of the municipal/city the municipal/city estimates of poverty
estimates of poverty incidence using incidence using direct, regression-synthetic
direct, regression synthetic and EBLUP and EBLUP methods.
methods.
Coefficient
of
Variation Direct Regression EBLUP
0.00-
10.00 35.42 70.43 18.75
10.01-
20.00 37.50 22.61 37.5
>20.00 27.08 6.96 43.75
Total 100.00 100.00 100

30
VI. SUMMARY AND CONCLUSION

The Philippine government is continuously fighting poverty in our country. It is

important that the resources are properly allocated to the people who needed the most assistance.

One way of reducing poverty is by determining the area where poverty is severe and poverty

incidence is one way of measuring poverty.

Three small area techniques were used in estimating municipal/city poverty incidence in

Bicol region, these were; direct, regression synthetic and empirical best linear unbiased estimator

(EBLUP). Mean square error was used to evaluate the precision and accuracy of the estimates

while coefficient of variation determines whether the estimate is reliable or not.

Using the 2003 FIES, direct estimation technique generated 48 valid estimates out of the

115 municipalities since only these municipalities/cities have a valid measure of variability and

reliability. About 34% of its estimates have poverty incidence that is greater than 50%. However,

most of its estimates have mean square error that is greater than 0.006. Also, about 65% of its

coefficient of variation is not reliable. This indicates that most of its estimates are less precise

and accurate and unreliable.

Using some variables from 2000 CPH, a model was constructed using the weighted least

square. The predicting model has three significant predictors; proportion of persons with no

grade completed, proportion of households with at least one member aged 1 to 6 years old, and

proportion of housing units with unfinished construction. All of the predictors has a direct

relationship on poverty. The resulting model has satisfied all the assumptions of the regression

31
model. The model obtained an adjusted R2 of 53.80%, which is the total variation of the

proportion of poor households that can be explained by the predictors of the model.

Using the predicting model, the regression synthetic method has produced 115 estimates.

Most of its estimates have poverty incidence ranging from 40 to 50%, accounting to about 33%

of the estimates. Also, about 22% of its estimates have poverty incidence from 50 to 60%. In

terms of accuracy and precision, an overwhelming majority of its estimates are precise and

accurate with mean square error at most 0.001. Similarly, most of its estimates are reliable with

coefficient of variation of at most 10%, accounting to about 71% of its estimates.

The empirical best linear unbiased estimate have also produced 48 estimates out of the

115 municipalities. Most of its estimates have poverty incidence of greater than 50%, accounting

to about 36% of its estimates. About 48% of its estimates have mean square error that is greater

than 0.006. This indicates that most of its estimates are less precise and accurate. Likewise, only

9 of its estimates are reliable, with coefficient of variation at most 10%. Thus, most of its

estimates are unreliable.

Both the direct and EBLUP method showed that Pio Duran is the poorest municipality in

Bicol Region with about 80% poverty incidence, followed by Placer with 78% poverty

incidence. However, in the regression synthetic method, Pio Duran only ranked 13th as the

poorest municipality. Instead, Mobo with poverty incidence of about 71% rank 1st as the poorest

municipality.

The regression synthetic technique has produced the most number of precise and accurate

estimators as measure by their mean square error which is at most 0.001. Also, it has produced

32
the most number of reliable estimates as measured by its coefficient of variation. Thus, the

regression synthetic estimation procedure has produced the “best set of estimates.”

33
LITERATURE CITED

ALBACEA,ZVJ. 1999 Small Area Estimation of Poverty Incidence in the Philippines.


Unpublished Doctoral Dissertation, University of the Philippines, Los Baños.

ABARINTOS, J.G. 2005 Estimating Consumption-based Poverty Incidence in the Philippines.


Unpublished Undergraduate Special Problem, University of the Philippines Los Banos..

AMAR,R.I.Z.G.2007 Barangay Level Estimation of the Proportion of Underweight Filipino


Children Aged 0-5 Years Old. Unpublished Master Thesis, University of the
Philippines Los Banos.

CABRERA, P.P. 2005 Estimating Provincial Food Poverty Incidence in the Philippines.
Unpublished Undergraduate Special Problem, University of the Philippines Los Banos.

COCHRAN, W.G 1997 Sampling Techniques, 3rd edition, John Wiley and Sons.

DONCERAS, N.S. 2005 Estimating Proportion of Women in the Labor Force at Muncipality
Level in CALABARZON Region.Unpublished Undergraduate Special Problem, University
of the Philippines Los Banos.

National Statistical Coordinating Board 2005 Technical Notes on the 2003 Poverty Estimates.
http://www.nscb.gov.ph.

MAGISTRADO, G.S 2005 Estimating the Participation Rate of Women in the Labor Force at
Municipal Level in Bicol Region..Unpublished Undergraduate Special Problem,
University of the Philippines Los Banos.

PEREZ, R.G 2007 Design-based and Model-based Estimation of Poverty Measures at the
Provincial Level in Philippines. Unpublished Master Thesis, University of the Philippines
Los Banos.

SOTTO, J.C 2006 Estimating the Proportion of Underweight Children Aged 0 to 5 Years Old at
the Provincial Level in the Philippines. Unpublished Undergraduate Special Problem,
the Philippines Los Banos.

34
Appendix I

Diagnostic Checking

Using Weighted Least Square


Number of obs=48
Source SS df MS
F(3,44)=19.25
Model 0.91083 3 0.30361 Prob>F=0.0000
Residual 0.69412 44 0.01578 R-square=0.5675
Total 1.60495 47 0.03415 Adj R-squared=0.5380
Root MSE=0.1256

Poverty Coef. Std. Error t P>t [95% Conf.Interval]


Pnngrade 4.67506 1.700023 2.75 0.0090 1.248885 8.101229
Phld16 2.93426 0.7459971 3.93 0.0000 1.430796 4.437713
Prepair_uncon 0.96514 0.4070483 2.37 0.0220 0.144789 1.785493
_cons -1.3496 0.349848 -3.86 0.0000 -2.054625 -0.64448

Assumption of Regression Model

Test for multicollinearity


Variable VIF 1/VIF
Phld16 1.82 0.54966
Pnngrade 1.64 0.608696
Prepair_uncon 1.15 0.872302
Mean VIF 1.54

Test of Homocedasticity
Cook-Weisberg test for heteroskedasticity using variables specified
Ho: Constant variance
chi2(1) = 0.43
Prob > chi2 = 0.5124

Test of Normality

35
Varia Pr(Skewness) Pr(Kurtosis) adj chi2(2) Prob>chi2
ble
resid_rs 0.426 0.401 1.38 0.5022
Residual Mean Equals Zero
Variable t P>|t|
resid_rs 0.2197 0.8267

Test on Autocorrelation
Durbin-Watson d-statistic( 3, 48) = 1.82134

POVERTY THRESHOLDS

2003 Poverty Threshold(in Php)

Province All Areas

Albay 12,890

Camarines Norte 12,656


Camarines Sur 11,871

Catanduanes 11,878
Masbate 12,466
Sorsogon 12,462

Source:National Statistical Coordinating Board Official Website

36
Appendix II
Poverty Incidence Estimates
A.Direct Estimation Technique
Prov Mun Prov Name Mun Name PI Bias Var MSE CV
5 1 Albay Bacacay 59.38 0.004272 0.004673 0.004691 8.87
5 2 Albay Camalig 26.83 -0.000652 0.001549 0.001550 7.60
5 3 Albay Daraga 27.71 0.004646 0.010564 0.010586 19.54
5 4 Albay Guinobatan 18.75 . . . .
5 6 Albay Legaspi City 28.02 -0.008299 0.012058 0.012127 20.80
5 7 Albay Libon 40.48 -0.001983 0.005527 0.005531 11.69
5 8 Albay Ligao City 71.43 . . . .
5 9 Albay Malilipot 44.44 . . . .
5 10 Albay Malinao 36.86 0.011930 0.052870 0.053012 37.92
5 11 Albay Manito 27.78 . . . .
5 12 Albay Oas 51.54 0.025365 0.028574 0.029170 23.81
5 13 Albay Pio Duran 79.31 -0.000238 0.000051 0.000051 0.80
5 14 Albay Polangui 27.78 . . . .
5 15 Albay Rapu-rapu 55.00 . . . .
Santo
5 16 Albay Domingo 36.36 . . . .

5 17 Albay Tabaco City 20.72 -0.001196 0.014701 0.014703 26.64


16 1 Camarines Norte Basud 46.95 -0.009622 0.010355 0.010448 14.92

16 3 Camarines Norte Daet 25.02 0.013045 0.014554 0.014724 24.26


San Lorenzo
16 4 Camarines Norte Ruiz 55.56 . . . .
Jose
16 5 Camarines Norte Panganiban 77.78 . . . .

16 6 Camarines Norte Labo 57.88 0.069895 0.007830 0.012715 14.82


16 7 Camarines Norte Mercedes 45.16 0.022154 0.018867 0.019358 20.70
16 8 Camarines Norte Paracale 61.54 . . . .

16 10 Camarines Norte Santa Elena 66.67 0.002449 0.006530 0.006536 9.90

16 12 Camarines Norte Vinzons 38.24 0.003053 0.002694 0.002703 8.41


17 1 Camarines Sur Baao 77.81 0.025802 0.013787 0.014453 13.63
17 3 Camarines Sur Bato 40.74 -0.003556 0.009220 0.009233 15.05

37
17 5 Camarines Sur Buhi 40.00 -0.007150 0.011377 0.011428 16.90
17 6 Camarines Sur Bula 26.67 . . . .
17 8 Camarines Sur Calabanga 37.50 . . . .
17 9 Camarines Sur Camaligan 10.34 0.001369 0.001447 0.001449 11.84
17 10 Camarines Sur Canaman 22.45 0.002304 0.002562 0.002567 10.69
17 14 Camarines Sur Garchitorena 66.67 0.002419 0.006530 0.006536 9.90
17 16 Camarines Sur Iriga City 28.92 0.000056 0.001367 0.001367 6.88
17 17 Camarines Sur Lagonoy 71.43 . . . .
17 18 Camarines Sur Libmanan 47.55 -0.001846 0.013978 0.013982 17.15
17 19 Camarines Sur Lupi 68.74 -0.005036 0.006731 0.006756 9.90
17 20 Camarines Sur Magarao 41.18 . . . .
17 22 Camarines Sur Minalabac 57.57 0.002036 0.000485 0.000490 2.90
17 23 Camarines Sur Nabua 46.43 0.014541 0.010415 0.010626 15.13
17 24 Camarines Sur Naga City 16.80 0.004828 0.006001 0.006024 18.90
17 25 Camarines Sur Ocampo 41.67 . . . .
17 26 Camarines Sur Pamplona 53.33 . . . .
17 27 Camarines Sur Pasacao 70.57 0.005741 0.003261 0.003294 6.80
17 28 Camarines Sur Pili 22.23 -0.008630 0.023813 0.023887 32.78
17 29 Camarines Sur Presentation 65.38 . . . .
17 30 Camarines Sur Ragay 24.00 . . . .
17 34 Camarines Sur Sipocot 37.76 0.021550 0.006576 0.007040 13.66
20 2 Catanduanes Baras 26.32 0.016309 0.001967 0.002233 9.21
20 4 Catanduanes Caramoan 62.50 . . . .
20 6 Catanduanes Pandan 8.33 . . . .
20 8 Catanduanes San Andres 53.85 0.010894 0.002242 0.002361 6.62
20 11 Catanduanes Virac 20.94 -0.003790 0.024938 0.024952 34.52
41 1 Masbate Aroroy 48.01 0.077300 0.047697 0.053672 33.43
41 3 Masbate Balud 47.08 -0.117280 0.048925 0.062680 36.49
41 6 Masbate Cawayan 82.14 . . . .
41 8 Masbate Dimasalang 60.00 . . . .
41 10 Masbate Mandaon 57.89 . . . .
41 11 Masbate Masbate 31.76 -0.000650 0.000019 0.000019 0.78
41 12 Masbate Milagros 42.85 -0.011580 0.006668 0.006802 12.59
41 14 Masbate Monreal 60.00 -0.000630 0.000256 0.000256 2.07
41 15 Masbate Palanas 52.62 0.031100 0.048469 0.049436 30.35
41 16 Masbate Pio V Corpuz 80.00 . . . .
41 17 Masbate Placer 78.57 0.005860 0.001665 0.001700 4.70

38
41 19 Masbate San Jacinto 5.26 . . . .
41 20 Masbate San Pascual 80.00 . . . .
41 21 Masbate Uson 57.06 0.024940 0.020070 0.020692 19.04
62 1 Sorsogon Bacon 14.29 . . . .
62 2 Sorsogon Barcelona 23.53 . . . .
62 3 Sorsogon Bulan 40.00 . . . .
62 4 Sorsogon Bulusan 60.00 . . . .
62 5 Sorsogon Casiguran 17.24 . . . .
62 6 Sorsogon Castilla 44.12 -0.012530 0.010271 0.010428 15.37
62 8 Sorsogon Gubat 32.34 0.057840 0.015068 0.018151 23.86
62 9 Sorsogon Irosin 55.56 . . . .
62 10 Sorsogon Juban 42.96 0.000430 0.000333 0.000333 2.78
62 11 Sorsogon Magallanes 40.72 0.004860 0.015923 0.015947 19.79
62 12 Sorsogon Matnog 57.14 0.000000 0.000000 0.000000 0.00
62 13 Sorsogon Pilar 21.96 0.020020 0.017187 0.017588 28.30
62 16 Sorsogon Sorsogon 18.87 0.001640 0.004112 0.004115 14.77

B.Regression Synthetic Estimates


Prov Mun Prov Name Mun Name Poverty MSE CV
5 1 Albay Bacacay 45.52 0.00089 6.56
5 2 Albay Camalig 29.96 0.00142 12.56
5 3 Albay Daraga 29.41 0.00274 17.80
5 4 Albay Guinobatan 34.51 0.00099 9.10
5 5 Albay Jovellar 53.84 0.00132 6.75
5 6 Albay Legaspi City 29.55 0.00095 10.44
5 7 Albay Libon 47.40 0.00088 6.26
5 8 Albay Ligao City 49.47 0.00064 5.11
5 9 Albay Malilipot 38.62 0.00117 8.87
5 10 Albay Malinao 50.90 0.00147 7.54
5 11 Albay Manito 43.85 0.00151 8.87
5 12 Albay Oas 39.03 0.00058 6.16
5 13 Albay Pio Duran 57.82 0.00067 4.49
5 14 Albay Polangui 34.17 0.00051 6.58
5 15 Albay Rapu-rapu 60.58 0.00159 6.57
Santo
5 16 Albay Domingo 34.17 0.00159 11.66
5 17 Albay Tabaco City 39.84 0.00055 5.90

39
5 18 Albay Tiwi 58.93 0.00388 10.57
16 1 Camarines Norte Basud 55.65 0.00230 8.62
16 2 Camarines Norte Capalonga 56.82 0.00129 6.33
16 3 Camarines Norte Daet 18.76 0.00144 20.26
San Lorenzo
16 4 Camarines Norte Ruiz 46.86 0.00047 4.63
Jose
16 5 Camarines Norte Panganiban 40.90 0.00054 5.67

16 6 Camarines Norte Labo 43.62 0.00034 4.20

16 7 Camarines Norte Mercedes 48.16 0.00101 6.60

16 8 Camarines Norte Paracale 48.58 0.00042 4.24

16 9 Camarines Norte San Vicente 41.31 0.00152 9.44


16 10 Camarines Norte Santa Elena 48.02 0.00062 5.19
16 11 Camarines Norte Talisay 19.11 0.00167 21.40
16 12 Camarines Norte Vinzons 39.36 0.00048 5.57
17 1 Camarines Sur Baao 45.72 0.00090 6.57
17 2 Camarines Sur Balatan 58.52 0.00170 7.05
17 3 Camarines Sur Bato 45.10 0.00110 7.34
17 4 Camarines Sur Bombon 0.00064 5.71
17 5 Camarines Sur Buhi 39.35 0.00098 7.97
17 6 Camarines Sur Bula 51.77 0.00085 5.62
17 7 Camarines Sur Cabusao 42.61 0.00036 4.46
17 8 Camarines Sur Calabanga 44.27 0.00075 6.19
17 9 Camarines Sur Camaligan 16.14 0.00207 28.17
17 10 Camarines Sur Canaman 26.79 0.00130 13.44
17 11 Camarines Sur Caramoan 48.52 0.00100 6.51
17 12 Camarines Sur Del Gallego 62.27 0.00156 6.35
17 13 Camarines Sur Gainza 37.01 0.00252 13.57
17 14 Camarines Sur Garchitorena 69.55 0.00262 7.36
17 15 Camarines Sur Goa 58.30 0.00156 6.77
17 16 Camarines Sur Iriga City 31.66 0.00095 9.72
17 17 Camarines Sur Lagonoy 36.73 0.00052 6.24
17 18 Camarines Sur Libmanan 34.62 0.00068 7.54

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17 19 Camarines Sur Lupi 57.12 0.00101 5.55
17 20 Camarines Sur Magarao 42.89 0.00086 6.85
17 21 Camarines Sur Milaor 40.03 0.00183 10.69
17 22 Camarines Sur Minalabac 49.97 0.00060 4.89
17 23 Camarines Sur Nabua 32.65 0.00132 11.14
17 24 Camarines Sur Naga City 13.08 0.00247 37.98
17 25 Camarines Sur Ocampo 55.89 0.00074 4.86
17 26 Camarines Sur Pamplona 62.09 0.00098 5.05
17 27 Camarines Sur Pasacao 54.29 0.00104 5.94
17 28 Camarines Sur Pili 39.67 0.00089 7.54
17 29 Camarines Sur Presentation 54.10 0.00060 4.54
17 30 Camarines Sur Ragay 41.43 0.00071 6.41
17 31 Camarines Sur Sagnay 47.62 0.00076 5.79
San
17 32 Camarines Sur Fernando 47.67 0.00172 8.69
17 33 Camarines Sur San Jose 31.97 0.00067 8.10
17 34 Camarines Sur Sipocot 49.34 0.00039 3.99
17 35 Camarines Sur Siruma 57.10 0.00069 4.60
17 36 Camarines Sur Tigaon 39.56 0.00052 5.79
17 37 Camarines Sur Tinambac 51.55 0.00081 5.52
20 1 Catanduanes Bagamanoc 36.42 0.00224 12.99
20 2 Catanduanes Baras 38.49 0.00167 10.60
20 3 Catanduanes Bato 28.06 0.00153 13.92
20 4 Catanduanes Caramoan 58.85 0.00113 5.72
20 5 Catanduanes Gigmoto 26.35 0.00118 13.06
20 6 Catanduanes Pandan 45.63 0.00231 10.54
20 7 Catanduanes Panganiban 21.57 0.00288 24.87
20 8 Catanduanes San Andres 56.25 0.00317 10.00
20 9 Catanduanes San Miguel 44.00 0.00168 9.30
20 10 Catanduanes Viga 29.90 0.00153 13.10
20 11 Catanduanes Virac 25.54 0.00115 13.30
41 1 Masbate Aroroy 64.53 0.00182 6.62
41 2 Masbate Baleno 36.49 0.00160 10.95
41 3 Masbate Balud 44.28 0.00048 4.94
41 4 Masbate Batuan 27.09 0.00185 15.87
41 5 Masbate Cataingan 57.37 0.00242 8.58

41
41 6 Masbate Cawayan 70.45 0.00387 8.83
41 7 Masbate Claveria 45.36 0.00351 13.06
41 8 Masbate Dimasalang 52.51 0.00107 6.22
41 9 Masbate Mandaon 38.19 0.00410 16.76
41 10 Masbate Mandaon 44.24 0.00079 6.36
41 11 Masbate Masbate 47.29 0.00054 4.94
41 12 Masbate Milagros 64.77 0.00112 5.17
41 13 Masbate Mobo 70.99 0.00164 5.71
41 14 Masbate Monreal 49.69 0.00114 6.80
41 15 Masbate Palanas 49.61 0.00589 15.47
Pio V
41 16 Masbate Corpuz 35.28 0.00370 17.25
41 17 Masbate Placer 70.29 0.00483 9.89
San
41 18 Masbate Fernando 6.36 0.00365 94.98
41 19 Masbate San Jacinto 13.97 0.00442 47.57
41 20 Masbate San Pascual 54.75 0.00123 6.40
41 21 Masbate Uson 55.05 0.00106 5.92
62 1 Sorsogon Bacon 45.78 0.00362 13.15
62 2 Sorsogon Barcelona 25.63 0.00111 12.99
62 3 Sorsogon Bulan 40.53 0.00063 6.19
62 4 Sorsogon Bulusan 36.68 0.00095 8.40
62 5 Sorsogon Casiguran 49.08 0.00041 4.13
62 6 Sorsogon Castilla 46.37 0.00086 6.31
62 7 Sorsogon Donsol 53.10 0.00061 4.67
62 8 Sorsogon Gubat 21.40 0.00153 18.27
62 9 Sorsogon Irosin 37.89 0.00041 5.36
62 10 Sorsogon Juban 57.86 0.00091 5.22
62 11 Sorsogon Magallanes 49.46 0.00057 4.84
62 12 Sorsogon Matnog 55.94 0.00110 5.93
62 13 Sorsogon Pilar 51.88 0.00055 4.53
62 14 Sorsogon Prieto Diaz 38.53 0.00040 5.18
Santa
62 15 Sorsogon Magdalena 19.50 0.00179 21.69
62 16 Sorsogon Sorsogon 26.87 0.00113 12.51

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C. EBLUP estimates
Prov Mun Prov Name Mun Name Poverty MSE CV
5 1 Albay Bacacay 56.28 0.00377 10.91
5 2 Albay Camalig 27.07 0.00145 14.05
5 3 Albay Daraga 28.33 0.00701 29.55
5 6 Albay Legaspi City 28.62 0.00730 29.86
5 7 Albay Libon 42.27 0.00430 15.51
5 10 Albay Malinao 47.69 0.01297 23.88
5 12 Albay Oas 43.49 0.01078 23.87
5 13 Albay Pio Duran 79.23 0.00005 0.90
5 17 Albay Tabaco City 29.85 0.00807 30.10
16 1 Camarines Norte Basud 50.44 0.00686 16.42
16 3 Camarines Norte Daet 21.95 0.00819 41.23
16 6 Camarines Norte Labo 53.23 0.00548 13.91
16 7 Camarines Norte Mercedes 46.86 0.00922 20.49
16 10 Camarines Norte Santa Elena 61.32 0.00485 11.35
16 12 Camarines Norte Vinzons 38.36 0.00236 12.67
17 1 Camarines Sur Baao 63.02 0.00786 14.07
17 3 Camarines Sur Bato 42.33 0.00621 18.62
17 5 Camarines Sur Buhi 39.71 0.00706 21.17
17 9 Camarines Sur Camaligan 10.77 0.00136 34.28
17 10 Camarines Sur Canaman 23.08 0.00228 20.70
17 14 Camarines Sur Garchitorena 67.60 0.00503 10.49
17 16 Camarines Sur Iriga City 29.11 0.00128 12.30
17 18 Camarines Sur Libmanan 41.54 0.00788 21.37
17 19 Camarines Sur Lupi 65.31 0.00499 10.82
17 22 Camarines Sur Minalabac 57.38 0.00047 3.79
17 23 Camarines Sur Nabua 40.98 0.00674 20.04
17 24 Camarines Sur Naga City 15.73 0.00471 43.60
17 27 Camarines Sur Pasacao 67.87 0.00281 7.81
17 28 Camarines Sur Pili 32.66 0.01015 30.84
17 34 Camarines Sur Sipocot 41.17 0.00485 16.92
20 2 Catanduanes Baras 27.62 0.00181 15.39
20 8 Catanduanes San Andres 54.11 0.00206 8.40
20 11 Catanduanes Virac 23.64 0.01039 43.12

43
41 1 Masbate Aroroy 60.50 0.01276 18.67
41 3 Masbate Balud 45.01 0.01254 24.88
41 11 Masbate Masbate 31.82 0.00002 1.37
41 12 Masbate Milagros 49.30 0.00497 14.30
41 14 Masbate Monreal 59.84 0.00025 2.66
41 15 Masbate Palanas 50.30 0.01368 23.25
41 17 Masbate Placer 77.83 0.00159 5.12
41 21 Masbate Uson 56.01 0.00949 17.39
62 6 Sorsogon Castilla 45.02 0.00662 18.07
62 8 Sorsogon Gubat 26.94 0.00836 33.94
62 10 Sorsogon Juban 43.31 0.00033 4.18
62 11 Sorsogon Magallanes 45.11 0.00842 20.34
62 12 Sorsogon Matnog 57.10 0.00081 4.99
62 13 Sorsogon Pilar 37.50 0.00873 24.92
62 16 Sorsogon Sorsogon 20.51 0.00341 28.49

44
ACKNOWLEDGEMENT

This paper was a product of hard work, perseverance, luck and guidance from above.

Our Lord God has been very kind to me ever since I was born. Once again, He showed
me that He will be with me no matter what happens. This paper is the proof that God never left
me whenever I need Him. Thank you for everything God Almighty. Your Love is above all.

To my family, Mama, Papa, Ate Leah, Ate Lorie, Ate Lanie, Ate Minda, Kuya Chris,
Kuya Wilson, Baby Nicole and Lola, thanks for being my inspiration to study harder and finish
my study on time.

To my adviser, Zita VJ Albacea, Ph.D, thank you for being patient with me and for being
meticulous in checking my paper. Ma’am, you have showed me that the best learning is through
the hard way. Thank you very much for giving some of your time to me in checking my paper. I
really appreciate everything you have done for us. Thank you.

To UPLB-INSTAT Faculty and staff, to Ma’am Allaine and Ma’am Riza, thank you for
not turning your back whenever I needed some clarifications. Thanks a lot.

To Joannedrew Del Rosario, thank you for being the reason why I continue to strive hard
in my studies. Your presence is more than enough to remind me that I have to work harder.
Thanks for your love and for being my reason to smile whenever I feel empty.

To my housemates, Brek, thanks for being a friend and a brother. You have helped me a
lot to be a better person. Jeff, Karl, Joker and Jenny, thank you for the moments that we are
together. My former housemates, Omar, Jan, Kosa, Mitch, Miko, Errol, Clark, thank you for
accompanying me in my first year in UPLB.

To my blockmates and batchmates05, Niña, Asley, Mitch, Lynell, Lovely, Rona, Rhea,
Jhona,Cris,Meryl, Kim, Lei,Docs, Werner, Rajan, Melvin, Majah, Mhakie, Aj, Mavick, Glen, Ed,
Lemon, Carmel, Mica and Jaimee thank you for the happiness that you brought in to my life. You
have made my college life happy. Jundy, thanks for always lending me money whenever I need it,
thanks for being my buddy. Thanks For all the IRRI and KODAK moments.

To Micth, Mir, Aiza, thank you for being there to answer some of my inquiries. Thanks a
lot.

To my bosses during my work as a student assistant, Tita Nits, Tita Cell and Kuya Ricky,
you have given me enough experience and taught me a lot of lessons. Thank you.

To Lakas Angkan Family, Kuya Otep, Kuya Ian and everyone in LA, thank you for being
my second family in UPLB. You have helped me a lot. Thank you.

45
To my High School Barkada, Eunie, Lester, Efraim, Bong, Marvin, Ken, Marco, Aj,
Herald, Dante, Anna, Dra, Jho, Len, Nikki, Chrissy, Alyssa, Am, Ervie, Mel, Carla, and the rest
of IV-Rizal, thank you for being there. For always making me laugh and smile whenever we are
together. You are the best!

To everyone, without you guys, I cannot achieve what I achieved. Thank You Very Much!

I Love UPLB!
REGINALD ARIMADO SIGNING OFF!!!

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