Microsimulation

The model integrates with PWBM's Tax Module, Social Security Module, and Dynamic OLG to assess government policy impacts. Starting with survey micro-data, the Microsim builds an initial simulated population and economy, including demographic information, individual decisions about work and residency, and macroeconomic characteristics.

The motion of this population over time is calibrated and validated to capture the momentum of demographic and economic shifts in the United States. Aggregating the simulated population's labor and capital supplies and combining with productivity growth factors yields conventional projections for the economy as a whole.

Continuing the simulation forward in time generates projections of alternative paths that the economy may take in the future given its current features and momentum.