Microsimulation and labour supply models: A survey and an interpretation

Speaker:  Ugo Colombino - Università degli Studi di Torino
  Friday, October 3, 2014 at 12:30 PM Sala Seminari Palazzina DSE V.lo Campofiore 2
This presentation illustrates the main points of a chapter written by Rolf Aaberge and Ugo Colombino for the Handbook of Microsimulation (Ed. C. O’Donoghue), Emerald, forthcoming 2014.

We start by telling the story of a conflictual marriage between empirical microeconomics and microsimulation, a divorce, and eventually a re-marriage that gave birth to behavioural microsimulation.

Next, we present, more or less chronologically, three main modelling strategies: reduced form, structural “marginalist” and random utility. We give an interpretation of why and how each one of them is replaced by the following one as a dominating paradigm. Within the random utility strategy, we distinguish two approaches, the Discrete Choice model and the Random-Utility Random-Opportunities model. We also discuss the issue of how necessary and reliable structural models are.
Last, we illustrate the main types of policy simulation exercises with labour supply models, with emphasis on the identification of optimal policies via simulation and on social evaluation criteria.

Programme Director
Federico Perali

External reference
Marcella Veronesi

Publication date
September 30, 2014