Empirical Bayes small area prediction under a zero-inflated lognormal model with correlated random area effects.

Many variables of interest in agricultural or economical surveys have skewed distributions and can equal zero. Our data are measures of sheet and rill erosion called Revised Universal Soil Loss Equation - 2 (RUSLE2). Small area estimates of mean RUSLE2 erosion are of interest. We use a zero-inflated lognormal mixed effects model for small area estimation. The model combines a unit-level lognormal model for the positive RUSLE2 responses with a unit-level logistic mixed effects model for the binary indicator that the response is nonzero. In the Conservation Effects Assessment Project (CEAP) data, counties with a higher probability of nonzero responses also tend to have a higher mean among the positive RUSLE2 values. We capture this property of the data through an assumption that the pair of random effects for a county are correlated. We develop empirical Bayes (EB) small area predictors and a bootstrap estimator of the mean squared error (MSE). In simulations, the proposed predictor is superior to simpler alternatives. We then apply the method to construct EB predictors of mean RUSLE2 erosion for South Dakota counties. To obtain auxiliary variables for the population of cropland in South Dakota, we integrate a satellite-derived land cover map with a geographic database of soil properties. We provide an R Shiny application called viscover (available at https://lyux.shinyapps.io/viscover/) to visualize the overlay operations required to construct the covariates. On the basis of bootstrap estimates of the mean square error, we conclude that the EB predictors of mean RUSLE2 erosion are superior to direct estimators.