SDR Variance Estimates in Small Domains

Eric Slud; Tim Trudell

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arXiv · 2608.17353

SDR Variance Estimates in Small Domains

Eric Slud·Tim Trudell

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Abstract

Successive Difference Replication (SDR) is a replication based method of variance estimation introduced by Fay and Train (1995) for estimators based on complex multistage surveys, especially those including a final systematic sampling stage. The method has been used for many years as the primary variance-estimation methodology in large national household surveys administered by the Census Bureau, including the American Community Survey and also the Current Population Survey's monthly estimates based on self-representing strata. In settings where it is applied, generally no second method of variance estimation has been available, so the performance of SDR has been studied via simulation by various authors, for variances of survey totals and of nonlinear survey estimators. This paper begins with a thorough exposition of the SDR method and review of previously published results on the small-domain biases of SDR variance estimation. It is shown that the number D of cycles used in implementing SDR should be 3 or larger, in order to control the variability of SDR estimates, but need not be larger than 5. Beyond that, the value of D is virtually irrelevant to the occurrence of small-domain bias in SDR. The SDR method is shown via theoretical formulas and simulation to inflate average estimated variances in small domains by amounts that vary systematically with the patterns of attribute means and variances and survey weights in consecutively enumerated strata. The degree of average variance inflation is generally moderate, no more than 15 percent in domains with sample size 20, but can be larger in special settings. Moreover, SDR estimates are extremely variable in small domains, with standard deviations often far larger than any biases.

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Eric Slud, Tim Trudell. 2026-08-18. SDR Variance Estimates in Small Domains. https://arxiv.org/abs/2608.17353

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