A Study on the Optimal Cut-off Point in the Cut-off Sampling Method

Modified cut-off sampling is widely used for highly skewed data. A serious drawback of modified cut-off sampling is the difficulty of adjustment of non-response in take-all stratum. Therefore, solutions of the problems of non-response in take-all stratum have been studied in various ways such as substitute of samples, imputation or re-weight method. In this paper, a new cut-off point based on minimizing MSE being used in exponential and power functions is suggested and it can be reduced the number of take-all stratum. We also investigate another cut-off point determination method with underlying distributions such as truncated log-normal and truncated gamma distributions. Finally we suggest the optimal cut-off point which has a minimum of take-all stratum size among suggested methods. Simulation studies are performed and Labor Survey data and simulated data are used for the case study.