Comparison of Spatial Prediction in Local and Global Area(Competition 1)

Abstract

When we analyze a spatial data, we generally conduct a global spatial analysis. But when spatial correlations are higher in local areas than global areas in analyzing spatial data, we think that local prediction performs better than global prediction in the prediction point of view. The present paper shows whether local prediction outperforms global prediction in the case of high correlation in a local area, based on the AMSE (average mean squared error) statistic. To show the usefulness of the proposed method, we perform a small simulation study and show an empirical example with the real transaction data of apartments in Korea.