The SEDIM Model: Version 0.1

Sanderson, W.C. (2004). The SEDIM Model: Version 0.1. IIASA Interim Report. IIASA, Laxenburg, Austria: IR-04-041

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Abstract

This paper presents the SEDIM (Simple Economic Demographic Interaction Model) Model. The model illustrates how economic, demographic, and technological factors can be integrated into a rich, but still relatively simple framework that predicts rates of economic growth. SEDIM is designed to show the effects of demographic changes, including changes in the education composition of the population on economic performance. The model includes age- and labor market experience-based productivity rates, policy-related changes in retirement ages, old age support from intergenerational transfers, public pension systems, private capital accumulation, and endogenous technological change. The model is designed for studying out of equilibrium dynamics. SEDIM can be used to investigate historical patterns of economic development as well as for making scenarios for the future. The advantage of the model is that it can be relatively easily parameterized for a variety of countries so that it can be used to discuss the determinants of economic growth in a consistent comparative framework. It is roughly parameterized for Egypt and a few forecasts for Egypts economic growth are shown.

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