Numerical Simulation as a Complement to Econometric Research on Workplace Safety.

Using a computable hedonic equilibrium model of the labor market, we numerically simulate the interactions between workers and firms as tempered by the state and federal regulations intended to influence workplace safety. We compute the changes needed for SSHA to become economically meaningful and determine the impact on safety from further expanding the experience rating of workers' compensation insurance premiums. Most importantly, we show how numerical simulation can serve as a complementary research tool to econometric models. Simulation is well suited for studying extreme policy changes and locating structural conditions pivotal in determining economic outcomes. Copyright 1995 by Kluwer Academic Publishers