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This volume, second in the series, provides essential background material for policy analysts, researchers, statisticians, and others interested in the application of microsimulation techniques to develop estimates of the costs and population impacts of proposed changes in government policies ranging from welfare to retirement income to health care to taxes.

The material spans data inputs to models, design and computer implementation of models, validation of model outputs, and model documentation.

Suggested Citation

National Research Council. 1991. Improving Information for Social Policy Decisions -- The Uses of Microsimulation Modeling: Volume II, Technical Papers. Washington, DC: The National Academies Press. https://doi.org/10.17226/1853.

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Publication Info

368 pages |  6 x 9 |  Paperback
ISBN: 978-0-309-04542-1
DOI: https://doi.org/10.17226/1853
Chapters skim
Front Matter i-viii
Introduction 1-1
Model Design 2-2
Model Evaluation 3-3
Dynamic Simulation of Income Model 2 (DYNASIM2) 4-4
Social Policy Simulation Database/Model (SPSD/M) 5-5
REFERENCES 6-8
Databases and Methods of Data Enhancement 9-10
INTRODUCTION 11-13
DATA NEEDS FOR MODELING INCOME SUPPORT PROGRAMS 14-16
SURVEY DESIGN OF THE MARCH CPS AND THE SIPP 17-20
Population Coverage 21-25
Household and Individual Nonresponse 26-27
Item Nonresponse 28-32
Reporting Errors 33-36
Sample Size 37-38
Data Delivery 39-40
Income Accounting Period 41-41
Income Detail 42-42
Households and Families Versus Program Filing Units 43-43
Asset Holdings 44-44
Other Variables for Related Policy Issues 45-45
EVALUATION OF ESTIMATES OF PROGRAM PARTICIPANTS FROM CPS AND SIPP 46-49
THE DIVISION OF LABOR FOR PRODUCTION OF DATABASES FROM CPS AND SIPP 50-52
THE SUITABILITY OF CPS AND SIPP FOR INTEGRATED MODELING OF TAXES AND TRANSFERS 53-55
CONCLUSIONS 56-57
REFERENCES 58-61
INTRODUCTION 62-62
File Treatment 63-63
Constrained and Unconstrained Statistical Matching 64-65
Choosing the Matching Variables 66-67
The EM-AF Statistical Match 68-68
Merge File of the Office of Tax Analysis 69-69
1966 Merge File for Household Income Data 70-70
Statistics Canada SCF-FEX Match 71-72
AFDC-Census Match 73-73
Conditional Independence 74-74
Limitations in Modeling 75-75
Reweighting of File B Data Resulting From Statistical Matching 76-76
Iterative Proportional Fitting 77-77
More Data Collection 78-78
Multiple Matching and File Concatenation 79-79
Rough Sensitivity Analysis 80-80
CONCLUDING NOTE 81-82
REFERENCES 83-86
Model Design 87-88
INTRODUCTION 89-89
CONVERTING ANNUAL TO MONTHLY VALUES IN TRIM2, MATH, AND HITSM 90-91
HITSM 92-92
TRIM2 93-93
MATH 94-94
HITSM 95-95
TRIM2 96-96
Input Data 97-97
MATH 98-98
Comment 99-99
Evaluation of Alternative Months Procedures 100-102
Need for Further Validation 103-103
PARTICIPATION FUNCTIONS FOR SSI, AFDC, AND FOOD STAMPS IN TRIM2, MATH, AND HITSM 104-104
TRIM2 105-105
HITSM 106-106
TRIM2 107-108
TRIM2 109-109
MATH 110-110
Evaluation of Alternative Participation Functions 111-112
APPENDIX: PERFORMANCE OF THE AFDC CALIBRATION PROCESS IN TRIM2 113-117
REFERENCES 118-120
THE MODELS 121-121
STARTING DATABASES 122-122
SIMULATION OF LONGITUDINAL HISTORIES 123-125
Labor Force Simulations 126-128
PRISM Pension Coverage and Characteristics 129-129
Interactions Between Pension and Social Security Eligibility and Retirement in PRISM 130-130
Labor Force Simulations 131-131
Retirement in DYNASIM2 132-132
DYNASIM2 Pension Coverage and Characteristics 133-133
CONCLUSIONS 134-135
REFERENCES 136-138
Computing Technology 139-140
INTRODUCTION 141-141
Layered Structure 142-143
Single Period Versus Future Projections 144-144
Static Versus Dynamic Simulation 145-145
Historical Background 146-147
History 148-148
Database Creation 149-150
Database Structure and Size 151-154
SPSD/M Parameters 155-155
Model Execution 156-157
Comparing Model Runs 158-158
Output Facilities 159-159
Other Software Facilities 160-160
Availability, Customer Base, and Technical Support 161-161
Future Work 162-162
History 163-167
Database Creation 168-168
Database Structure and Size 169-171
Database Adjustment 172-172
Operating Characteristics 173-173
TRIM2 Parameters 174-174
Model Execution 175-175
Output Facilities 176-176
Other Software Facilities 177-177
Operating Environment 178-178
Comparison 179-184
Background 185-185
Informed Industry Observers 186-186
Specific Technical Product Information 187-187
Advances in Computer Processors 188-188
Advances in Primary Memory 189-189
Advances in Computer Systems Architecture 190-191
Economic Studies of Industry Performance 192-196
Assessment and Predictions 197-198
Nature of the Demand for Microanalytic Simulation Models 199-199
Factors Affecting the Availability of Microsimulation Models 200-200
Functions of a System for Microanalytic Simulation 201-201
Larger Model Execution on the Desktop 202-203
Advances in Software Methodology 204-204
Model Specification 205-213
Object-Oriented Computing 214-214
Simulation Module Consistency 215-215
Advantages of Desktop-Based Environments 216-216
Summary 217-217
RECOMMENDATIONS AND CONCLUSIONS 218-219
Short-Term Issues 220-220
Porting TRIM2 to an MS-DOS Environment 221-221
Translating TRIM2 Modules to the C Language 222-222
Benefits of Porting TRIM2 223-224
Medium-Term Issues 225-229
REFERENCES AND BIBLIOGRAPHY 230-234
Model Validation 235-236
6 Variance Estimation of Microsimulation Models Through Sample Reuse 237-237
COMPUTATIONS OF MICROSIMULATION MODELS 238-238
NONPARAMETRIC VARIANCE ESTIMATION 239-244
MODELS AND VARIABILITY 245-246
BOOTSTRAPPING MICROSIMULATION MODELS 247-249
Incorporation of Sensitivity Analyses - Measurement of Total Uncertainty 250-250
Number of Replications Needed 251-251
Use of Resampling Techniques in Constructing Confidence Intervals 252-252
REFERENCES 253-254
7 Evaluations of Microsimulation Models: Literature Review 255-255
HENDRICKS AND HOLDEN (1976A) 256-256
HENDRICKS AND HOLDEN (1976B) 257-257
GENERAL ACCOUNTING OFFICE (1977) 258-259
HOLDEN (1977) 260-260
HAYES (1982) 261-262
JEFFERSON (1983) 263-263
HAVEMAN AND LACKER (1984) 264-264
ICF, INC. (1987) 265-266
KORMENDI AND MEGUIRE (1988) 267-267
BETSON (1988) 268-268
DOYLE AND TRIPPE (1989) 269-269
BEEBOUT AND HAWORTH (1989) 270-270
BURTLESS (1989) 271-271
DISCUSSION 272-273
REFERENCES 274-275
8 A Validation Experiment with TRIM2 276-276
OVERVIEW OF THE EXPERIMENT 277-277
CHOICE OF MODEL YEAR, PROGRAM YEAR, AND COMPARISON VALUES 278-278
CHOICE OF COMPONENT MODULES AND ALTERNATIVES FOR STUDY IN TRIM2 279-280
OUTPUTS EXAMINED 281-282
Total Variability Due to Use of Alternative Modules 283-285
Analysis of Variance Methods for Sensitivity Analysis and External Validation 286-290
Nonparametric Analysis 291-294
Analysis of Categorical Data 295-297
MAJOR CONCLUSIONS 298-299
LIMITATIONS OF THE PRESENT STUDY 300-300
DESIGN OF EXPERIMENT ISSUES 301-301
REFERENCES 302-304
INTRODUCTION 305-306
NATURE OF POPULATION PROJECTION MODELS 307-308
VALIDATING POPULATION PROJECTIONS 309-309
Sensitivity Analysis 310-313
External Validation 314-318
CONFIDENCE INTERVALS 319-324
CONCLUSIONS 325-325
REFERENCES 326-330
Model Documentation 331-332
INTRODUCTION 333-334
PURPOSES OF DOCUMENTATION AND EVALUATION CRITERIA 335-335
Critique 336-337
Suggestions 338-338
Critique 339-342
Suggestions 343-343
Critique 344-344
Suggestions 345-345
COMPARISONS WITH IEEE STANDARDS 346-350
REFERENCES 351-351

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