MIDAS is a dynamic population model with dynamic cross-sectional ageing. This means that it starts from a cross-sectional dataset representing a population of all ages at a certain point in time, in this case the PSBH dataset for Belgium in 2002, the SOEP for Germany in 2002 and a compound dataset based on the ECHP, for Italy in 2001. From that starting year on, the life spans of individuals in the dataset is simulated, together with their interactions. So new individuals are born, go through school, marry or cohabit, enter the labour market, divorce, retire and, finally, die. All these main events in a life time are simulated by the model. During their active years, they build up pension rights, which result in a pension benefit when they retire. In the second chapter of this report, microsimulation models (henceforth MSMs) are classified, and the simulation properties of models in this classification are discussed. Then the above definition of adequacy and its goals are linked to the simulation properties of MSM’s in general, and specifically of MIDAS.
The microsimulation model MIDAS consists of different modules, being the demographic module, the labour market module and the pension module. The demographic module is for the three countries developed by the Federal FPB; the common labour market module is developed by the DIW and each partner is obviously responsible for the development of its own pension module.