This essay examines how microanalytic simulation (microsimulation) proposed by Guy H. Orcutt emerged as a tool in evaluating public policies. Inspired by the econometric work of Jan Tinbergen, young Orcutt harbored a “Tinbergen dream” in building a model covering the national economy. Early in his career, he had developed an analogue electrical-mechanical “regression analyzer” to calculate statistical estimates. During the mid-1950s, he shifted to micro-level data and the Monte Carlo method, and then created the first microanalytic simulation of demographic variables. After a failed trial at the University of Wisconsin, his ambitious microsimulation finally succeeded at the Urban Institute, constituted as the Dynamic Simulation of Income Model. Since the late-1970s, microsimulation have been used to understand the economic consequences of welfare and redistributive policies. As a pretrained electrical engineer and physicist, Orcutt viewed the socioeconomic system as an electrical-mechanical network. Microsimulation was an engine designed for not only scrutinizing the system but reengineering the society.
Guy H. Orcutt’s Engineering Microsimulation to Reengineer Society
Chung-Tang Cheng is a PhD candidate in economic history at the London School of Economics and was a research fellow at the Center for the History of Political Economy at Duke University for the 2018–19 academic year. His thesis investigates how econometricians have used micro-level data to produce empirical knowledge since the postwar era.
Chung-Tang Cheng; Guy H. Orcutt’s Engineering Microsimulation to Reengineer Society. History of Political Economy 1 December 2020; 52 (S1): 191–217. doi: https://doi.org/10.1215/00182702-8718000
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