Assessing poverty and inequality at a detailed regional level: new advances in spatial microsimulation

During the past three years NATSEM has developed path-breaking spatial microsimulation techniques, involving the creation of synthetic data about the socioeconomic characteristics of households at a detailed regional level. The data are potentially available at any level of geographic aggregation, down to the level of the Census Collection District (about 200 households). This paper describes the results of initial attempts to link the new database to NATSEM's existing STINMOD static microsimulation model of taxes and transfers in Australia, so that the spatial impact upon poverty and inequality of possible policy changes can be assessed. This paper outlines the new techniques used to create the synthetic household microdata and demonstrates how it can be used to analyse poverty rates, the spatial impact of possible policy change, and the characteristics of the poor by geographic area.