Pensim2 is a dynamic

microsimulation Microsimulation is the use of computerized analytical tools to perform analysis of activities such as highway traffic flowing through an intersection, financial transactions, or pathogens spreading disease through a population on the granularity ...

model A model is an informative representation of an object, person, or system. The term originally denoted the plans of a building in late 16th-century English, and derived via French and Italian ultimately from Latin , . Models can be divided in ...

to simulate the

income Income is the consumption and saving opportunity gained by an entity within a specified timeframe, which is generally expressed in monetary terms. Income is difficult to define conceptually and the definition may be different across fields. F ...

pensioner A pensioner is a person who receives a pension, most commonly because of retirement from the workforce. This is a term typically used in the United Kingdom (along with OAP, initialism of old-age pensioner), Ireland and Australia where someone of p ...

s, owned by the

British British may refer to: Peoples, culture, and language * British people, nationals or natives of the United Kingdom, British Overseas Territories and Crown Dependencies. * British national identity, the characteristics of British people and culture ...

Department for Work and Pensions The Department for Work and Pensions (DWP) is a Departments of the Government of the United Kingdom, ministerial department of the Government of the United Kingdom. It is responsible for welfare spending, welfare, pensions and child maintenance ...

. Pensim2 is the second version of Pensim which was developed by

Institute for Fiscal Studies The Institute for Fiscal Studies (IFS) is an independent economic research institute based in London, United Kingdom, which specialises in UK taxation and public policy. It produces both academic and policy-related findings. The institute's ...

in the 1990s. The

time horizon A time horizon, also known as a planning horizon, is a fixed point of time in the future at which point certain processes will be evaluated or assumed to end. It is necessary in an accounting, finance or risk management regime to assign such a f ...

of the model is 100 years, by which time today's school leavers will retire. Pensim2 uses a lot of external alignment figures.

Overview

Pensim2 uses aggregate and micro-level data from different data sources, e.g.

BHPS The British Household Panel Survey (BHPS), carried out at the Institute for Social and Economic Research of the University of Essex, is a survey for social and economic research. A sample of British households was drawn and first interviewed in ...

LLMDB The Lifelong Labour Market Database (LLMDB2) is a panel data set, owned by the Department for Work and Pensions in Britain. LLMDB2 holds a 1% sample from the new ''National Insurance Recording System (NIRS2)'' and is a fully representative sample o ...

and the

Family Resources Survey The Family Resources Survey (FRS) is one of the United Kingdom's largest household surveys. It collects information on the incomes and characteristics of private households in the United Kingdom. It is published, controlled and funded by Departm ...

. It simulate a very wide range of economic processes: earnings,

housing Housing refers to a property containing one or more Shelter (building), shelter as a living space. Housing spaces are inhabited either by individuals or a collective group of people. Housing is also referred to as a human need and right to ...

savings Wealth is the abundance of valuable financial assets or physical possessions which can be converted into a form that can be used for transactions. This includes the core meaning as held in the originating Old English word , which is from an ...

pensions A pension (; ) is a fund into which amounts are paid regularly during an individual's working career, and from which periodic payments are made to support the person's retirement from work. A pension may be either a "defined benefit plan", wher ...

taxes A tax is a mandatory financial charge or levy imposed on an individual or legal entity by a governmental organization to support government spending and public expenditures collectively or to regulate and reduce negative externalities. Tax co ...

. It has the useful feature of allowing the user to specify certain parameters (for example the rate of return to the stock market).

References

External links

DWP homepage
Department for Work and Pensions Microsimulation {{econometrics-stub

Overview

See also

References

External links