SIDD: An adaptable framework for analysing the distributional implications of policy alternatives where savings and employment decisions matter

The Simulator of Individual Dynamic Decisions, SIDD, is publicly available software for analysing the distributional effects of policy alternatives. SIDD is a framework, rather than a model, in the sense that it is designed to facilitate adaptation to alternative country and policy contexts. The microsimulation framework can generate panel data describing a wide range of characteristics at annual intervals for each adult in an evolving population cross-section. Structural methods are employed to project savings and employment decisions, making SIDD a suitable tool for exploring the incentive effects of policy alternatives, and how these vary across the population and over time. The framework is also a valuable test-bed for empirical analyses of alternative behavioural assumptions, especially those concerning preferences for risk. In an effort to support good policy design and empirical analysis of savings and labour supply behaviour, SIDD has been made free for download from www.simdynamics.org.