Simulation

Simulation in IBM® SPSS® Statistics refers to simulating input data to predictive models using the Monte Carlo method and evaluating the model based on the simulated data. The distribution of predicted target values can then be used to evaluate the likelihood of various outcomes.

Each input in the predictive model is specified as simulated or fixed. Values of simulated inputs are generated by drawing from a specified probability distribution, allowing you to account for uncertainty in the values of those inputs. Fixed inputs are those whose values are known and held fixed at the known values.

The predictive model is evaluated using the generated values of the simulated inputs and the specified values of the fixed inputs to calculate the target (or targets) of the model. The process is repeated many times (typically tens of thousands or hundreds of thousands of times), resulting in a distribution of target values. Each repetition of the process generates a separate data record that consists of the values of the inputs and the predicted target (or targets) of the model.

Two interfaces are available for working with simulations:

• Simulation Builder. This is an advanced interface for users who are designing and running simulations. It provides the full set of capabilities for designing a simulation, saving the specifications to a simulation plan file, specifying output and running the simulation. You can build a simulation based on an IBM SPSS model file, or on a set of custom equations that you define in the Simulation Builder. The case study on modeling treatment costs for diabetes uses the Simulation Builder.
• Run Simulation dialog. The Run Simulation dialog is designed for users who have a simulation plan and primarily want to run the simulation. It allows you to modify settings that enable you to run the simulation under different conditions, but does not provide the full capabilities of the Simulation Builder for designing simulations. The case study on risk in a net present value calculation uses the Run Simulation dialog to do sensitivity analysis.