Pension Projection Models
The PSG models provide a broad range of social security analysis capabilities that are logically consistent because all solvency and distributional estimates in the OLC mode are built up from simulated samples of cohort individuals.
When switching from solvency to distributional analysis, the simulation sample size can be increased and the focus narrowed to a few birth cohorts or to cross-sectional samples of everyone alive in a few calendar years. Most other models use a fixed sample size that may be adequate for solvency analysis but can be too small for statistically reliable distributional analysis of a single birth cohort or a small population subgroup.
Both solvency and distributional analysis can be conducted assuming either a single-scenario deterministic macrodemographic and macroeconomic environment (usually the Trustees Report intermediate-cost assumptions) or a multiple-scenario stochastic environment.
The number of social security reforms that can be specified using existing policy parameters is enormous. This is because each earlier reform proposal has been characterized in the PSG models as changes in many detailed social security policy parameters (not as a unified proposal). After many years of enhancing the PSG models to characterize past reform proposals, there are a large number of policy parameters that can be configured in countless combinations.
In the future it is likely that there will be reform proposals that contain provisions not previously proposed, in which case the PSG models (like any other model) would need to be enhanced to add the policy parameters required to characterize the reform. This would be the continuation of a process that has been underway for more than a decade.
Other key features.