Empirical best prediction under a nested error model with log transformation
对数变换嵌套误差模型下的经验最佳预测
In regression models involving economic variables such as income, log transformation is typically taken to achieve approximate normality and stabilize the variance. However, often the interest is predicting individual values or means of the variable in the original scale. Under a nested error model for the log transformation of the target variable, we show that the usual approach of back transforming the predicted values may introduce a substantial bias. We obtain the…