Demographic trends and projections of continued slow productivity growth have led to significant concern about the viability of Social Security and Medicare in the next century. In addition to these gloomy predictions about public retirement programs, fundamental changes that are occurring in...

This paper presents a method for projecting person-level labor force participation and earnings for the U.S. population in a dynamic micro-simulation setting. A dynamic micro-simulation model starts with economic and demographic data for a current sample of the population, then stochastically...

Imagine a longitudinal micro data file that contains individual earnings along with basic demographic variables such as age, sex, education, marital status, and spouse’s characteristics for a representative future sample of the population. Such a data set would be invaluable for analyzing...

The Congressional Budget Office Long-Term (CBOLT) model uses dynamic micro-simulation for a representative sample of the population to analyze the aggregate and distributional effects of Social Security policy. In the model, overall mortality rates by age and sex are calibrated to match Social...

This paper describes a strategy for estimating predictive equations that has been shown to work well in microsimulation modeling. The technique, referred to here as “age-centered regression,” is particularly useful when the available data set for estimating a model equation is limited and...

This paper uses a series of cross-section wealth surveys to measure how wealth accumulation and active saving rates varied across cohort-groups during the early and mid 1990s. Our estimated rates of saving and wealth change across cohorts show a somewhat more dramatic life cycle pattern than...

The Congressional Budget Office Long-Term (CBOLT) policy simulation model was developed to answer budgetary and distributional questions about Social Security, Medicare, and other long-term policy issues. CBOLT has three distinct solution modes for making projections: static simulations with a...

Analysis and discussion of Social Security policy are usually based on expected fiscal and societal outcomes. However, future demographic and economic trends are uncertain, and thus ultimate outcomes for aggregate system financial flows and the distribution of taxes and benefits across...

The effect upon future Social Security benefits resulting from the introduction of individual accounts depends on both the potential risks and returns of private equities, yet the historical evidence about determinants of stock market risks and returns is mixed. In particular, correlations...

The Congressional Budget Office Long-Term (CBOLT) model uses dynamic micro-simulation to analyze Social Security policy. The version of CBOLT currently being used to analyze policy for the Congress incorporates micro behavioral effects insofar as agents alter their timing of initial claiming of...