Overview

Abstract (English)

Introduction: SIMUL is a dynamic, reduced-form microsimulation model of the Quebec economy developed by Chair team members. It is based on a large cross-sectional sample of the Quebec population, various retrospective and longitudinal surveys as well as official projections regarding future population composition. The model provides a comprehensive view of the economic and socio-demographic evolution of the Quebec population until 2050. As with all microsimulation models, which contrast with macrosimulation (or simulation of aggregates), SIMUL allows for the analysis of actions and interactions at the individual level, and provides complete distributions – current and future – for variables of interest, such as earnings, retirement incomes, family composition, or receipt of government transfers. The approach also allows to compute macrotype results by aggregating individual-level ones. Each individual in SIMUL follows a life course that is characterized by social, demographic and economic events such as birth, death, migration, household formation and break-up, education, saving, employment and retirement and their associated types of income. The type and frequency of these events depend on the individual’s and his household’s characteristics. The model is said to be dynamic because it updates all of these individual and household characteristics over several periods of time. The model’s most attractive feature therefore lies in its dual “distributive” and “accounting” natures (for private and public finances in the latter case). Indeed, SIMUL can project public expenditures and revenue while accounting for the distribution of socio-economic variables within the population. Finally, SIMUL may be used to assess the impact on public and private finances, as well as on the current and future distribution of socio-economic variables, of an existing or prospective economic environment or of specific public policies. Other microsimulation models have been built and used in Canada over time. The Social Policy Simulation Database and Model (SPSD/M) is a simulation-ready database offered by Statistics Canada that comes with its own “static accounting model”, the SPSM. The latter “processes each individual and family on the SPSD/M, calculates taxes and transfers using legislated or proposed programs and algorithms, and reports on the results”. Another model built and used at Statistics Canada is the Demosim demographic model, which is used to generate population projections. Perhaps the most recent and sophisticated model is LifePaths, which was built at Statistics Canada with support from various federal departments (mostly by that now known as Employment and Social Development Canada). Like SIMUL, LifePaths is a dynamic microsimulation model, meaning that individuals’ behaviours and life events are updated over time in an economically consistent fashion. However, the LifePaths project and model are now discontinued; some researchers may keep using the archived version, but it is no longer updated or supported. LifePaths and SIMUL are somewhat similar models (e.g., both are “open population”, meaning that individuals have synthetic families that are not formally part of the model), but there are major differences: for instance, the former is in continuous time, while the latter offers a more detailed modelling of labour force participation and of provincial taxes and transfers. Another important difference is that SIMUL is based on the “real” population of the 2011 National Household Survey.

Abstract (French)

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