Microsimulation is an extraordinarily powerful tool for analyzing the short- and long-term impacts of demographic trends and policy reforms on economic well-being. Microsimulation provides insights to the size, direction, and characteristics of winners and losers of policy reforms. It is a vital analysis tool for policymakers given the complexity of the US tax and benefit systems, as well as complex social interactions.
Karen Smith is a senior fellow in the Income and Benefits Policy Center at the Urban Institute, where she is an internationally recognized expert in microsimulation. Over the past 30 years, she has developed microsimulation models for evaluating Social Security, pensions, taxation, wealth and savings, labor supply, charitable giving, health expenditure, student aid, and welfare reform. Smith has played a lead role in the development of the Social Security Administration's Modeling Income in the Near Term microsimulation model, Urban’s Dynamic Simulation of Income microsimulation model, and the Social Security Administration’s Policy Simulation Model. Her recent work includes estimating the impact of the Great Recession on retirement well-being; analyzing income and asset accumulation patterns of the adult population; analyzing the retirement decision; evaluating the effect of disability on earnings and mortality; and using statistical matching to impute earnings, taxes, and spouse characteristics.
Smith has written extensively on demographic and economic trends, and their implications for the retirement well-being of current and future cohorts. She has contributed chapters to numerous books, including Closing the Deficit: How Much Can Later Retirement Help?; Redefining Retirement: How Will Boomers Fare?; Reshaping Retirement Security: Lessons from the Global Financial Crisis; and Social Security and the Family. She has also published articles in various scholarly journals, including the Social Security Bulletin, National Tax Journal, and Journal of Aging & Social Policy. She has served on advisory panels for the National Academy of Science, Brookings Institution, and Mathematica Policy Research.