Scenario Analysis

From Wiki
Revision as of 14:35, 20 July 2017 by CamrynDreyer (Talk | contribs)

Jump to: navigation, search

Scenario Description

A scenario is a story or story outline. Thinking about the future normally involves creating alternative scenarios, or stories, about the possible interactive evolution of variables. Some such scenarios are exploratory and consider the possible unfolding of different futures around key uncertainties, such as the rate of some aspect of technological advance or the fragility of some element in the global environment. Other scenarios are normative and develop stories about preferred futures, such as a global transformation to sustainability.

Scenarios in a computer model typically are built from multiple interventions that collectively help create a coherent story about the future. Often, but somewhat imprecisely, the word scenario is used more loosely to refer to any intervention (such as the change of a fertility rate for a country or an alternative assumption about oil resources).

Scenarios or interventions with respect to what? When IFs or other computer simulations are "run", without making any changes to parameters or initial conditions specified as the default values, they generate a forecast that is typically called the Base Case. The IFs Base Case, always available when a model session is initiated, is itself a scenario. Sometimes the Base Case is incorrectly referred to as a trend extrapolation or a "business as usual" scenario. More accurately, however, the IFs Base Case is a computation that involves the full dynamics of the model and therefore has very nonlinear behavior, often quite different from trends. It is a good starting point for scenario analysis for two reasons. First, it is built from initial conditions of all variables and on parameters that have been given reasonable values from data or other analysis. These initial conditions and parameters make up the package of interventions that constitute the Base Case scenario. Second, the Base Case is periodically analyzed relative to the forecasts of many other projects across the range of issue areas covered by IFs and is to a degree "tuned" for internal coherence and consistency with insights of respected forecasters.

There are two file types involved in IFs scenario creation: scenario files (or Scenario-Load-Files) and run files (or Run-Result-Files). Scenario files, the first type, are saved with an extension of .sce. Very small in size, .sce files contain information that the IFs model uses to create alternative scenarios; i.e., .sce files contain a list of parameter values that diverge from the Base Case. It is important to note that scenario files do not contain any forecasts. Forecasts are generated and saved only in the second type of file, run files with the .run extension. Because they contain forecasts of all IFs variables and parameters, .run files are much larger than scenario files. Although the IFs standalone model software allows users to save both types of files, web users are only able to save .sce files to retrieve their parameters and regenerate their scenarios.

In addition to the Base Case, most versions of IFs will include a number of other previously-run scenarios (see Lesson 0: IFs Vocabulary for additional important terminology), typically those for the Global Environmental Outlook (GEO) of the United Nations Environmental Program (UNEP). If you look, for instance, at the Flexible Displays form, you will see a list of previously-run scenarios in the box at the bottom of the screen. Because those have already been run, based on a set of interventions constituting their foundations, the user can immediately display their results.

Quick Scenario Analysis with Tree Overview

Overview

What is a scenario?

This section of the Help Menu will guide you through the task of changing parameters and variables and creating Scenario-Load-Files/Run-Result-Files.

After you have finished with this topic, you should be able to answer/do the following:

  • What is the difference between a Scenario-Load-File and a Run-Result-File?
  • What Previously-Run-Scenarios came installed in your version of IFs?
  • What is a scenario? What is not a scenario?

Introduction to the Scenario Tree:

The scenario tree allows you to call up or to mix and match an extensive number of your own interventions and/or a set of stored scenario intervention files. This feature of IFs allows you to change any parameter or initial condition used in the software for any country/region or group that you choose, thus effecting the relationships used to forecast trends. Use the Quick Scenario Analysis with Tree to create Scenario-Load-Files, run these files through IFs in order to create Run-Result-Files that you can use throughout IFs.

Below is the menu:

IMAGEhttp://www.du.edu/ifs/help/use/scenario/quick/quicktree.html

Loading Previously-Run Scenarios and Previously-Structured Scenarios

From the Scenario Files menu, you can clear your scenario tree, load Scenario-Load-Files or save your current Scenario-Load-File (.sce).

After you have finished with this topic, you should be able to do/answer the following:

  • How do you clear parameter changes from the scenario tree?
  • How do you find scenario files that are not used as Run-Result-Files?
  • What do you have to click on to understand exactly what is being changed by different previously-run scenarios and previously-structured scenarios? 

Adding Scenario Components and Other Previously Structured Scenarios

Another feature of the Quick Scenario Analysis with Tree is the ability to add other scenario components. These previously-structured or previously-run scenarios are helpful ways to look at possible emerging global trends.

After you have finished with this topic, you should be able to do/answer the following:

  • What does the Annotate Scenario option tell you?
  • Search through the scenarios until you find one that takes deals with environmental change.
  • Load a Scenario Component and return to the Scenario Tree.

Finding the Intervention You Want

In order to tailor your Run-Result-File to your needs, you must be able to quickly find the parameter you are looking for.

After you have finished with this topic, you should be able to do/answer the following:

  • What is the organizational logic of the tree?
  • Where would you look if you wanted to find a parameter by typing into a search menu?
  • What is the difference between the Selected Initial Conditions/Relationship Parameters and the other five main categories used in the Scenario Tree?

Exploring and Changing Parameters

Once you have found the parameter you are looking for, say, the Total Fertility Rate Multiplier (Households/Individuals, Demographic/Population, TFRM), a number of new options become available.

After you have finished with this topic, you should be able to do/answer the following:

  • How do you select a parameter to change?
  • What does multiplier mean?
  • What do the select, drivers, explain, view equations and define options all allow you to do?
  • How do you create a Run-Result-File?
  • How do you save the results?
  • How can you display the results of you change in IFs?

Previously-Run and Previously-Structured Scenarios

The following description of Previously-Run Scenarios and Previously-Structured will be based on the Quick Scenario Analysis with Tree option found under the Scenario Analysis option on the Main Menu of IFs.

To load Previously-Run Scenarios and Previously-Structured Scenarios, you must start by clicking on the Scenario Files menu option in the Main Menu of Quick Scenario Analysis with Tree.

If you would like to clear any changes to the parameter tree, click on New and decide whether or not you would like to save your current scenario. In order to load a previously-run scenario, click on the Open option and then scroll over to the scenario that you would like to load. Below is an image of some possible previously-run scenarios that can be loaded:

http://www.du.edu/ifs/help/use/scenario/quick/previously.html image

If you choose one of these previously-run scenarios, your parameter tree will change corresponding to the conditions of that file. To know what parameters were changed by the previously-run scenario, load the scenario and then click on Annotate Scenario at the top of the menu. This will access a brief description of the previously-run scenario along with a detailed list of all parameters that were changed.

From the Scenario Files menu, you can also add other previously-run scenarios that are not loaded into IFs, but that are saved in other files. Click on Add from the Scenario Files menu and you will be presented with a menu with a number of different previously-run scenarios that can be loaded into your parameter tree.

http://www.du.edu/ifs/help/use/scenario/quick/previously.html image

Click on one of the Scenario-Load-Files and you will be asked whether you want to load the .sce file. Click Yes and the parameter changes will be loaded into your parameter tree. Click on Annotate Scenario to see what parameters were changed.

From the Scenario Files menu, you can also save any of your scenario files. Simply click on Name and Save from the Scenario Files menu and you will be asked to choose where you would like to save your scenario and under what name. Note that these files are saved as .sce. Turning a file into a .run file requires you to run the model.

Adding Scenario Components

From the Main Menu of Quick Scenario Analysis with Tree, click on Add Scenario Components and you will be presented with another menu. When you click on the + arrows on the left, sub-categories open. The image below shows what happens when you click on the + next to the World Integrated Scenario Sets and then the + next to the UNEP Geo sub-category. Any of the below previously-structured scenarios can be loaded into IFs. Simply click on the scenario and then, at the top of the screen, on Load. If you would like to know more about each previously-structured scenario, load the scenario and then click on Annotate Scenario.

Finding Parameters and Variables

The Main Menu of Quick Scenario Analysis with Tree provides you with a tree on the left hand side of the screen. This tree represents all of the parameters and variables used in IFs. One way to find the parameter or variable you would like to change is to understand the general groupings of these categories. The first two options on the tree, Technological Change and Environmental Uncertainties, allow you to shape the intensity of technological growth and the intensity of various environmental trends. The third, fourth and fifth option on the tree, Households/Individuals, Governments/Social-Political Systems and Firms/Businesses, allow you to shape the parameters for the three main global actors. The final two options on the tree, Selected Initial Conditions and Relationship Parameters, allow you to change parameters at the onset of your run-file or the relationships between various parameters.

Another way for you to find the parameters you would like to change is by selecting the "Parameter Search" option on the top right of the toolbar. Clicking on this with bring up a window with a search box. For example, if you are looking to work with the malnourished children parameters, type in "malnourished" and hit enter. This will bring up any parameter with the word "malnourished" in its name. You can also search for the parameter or variable by its abbreviation.

Selecting this option will bring up a new window. From this window you can accomplish the following:

Type Variable Name: In the top box, type in a variable name and click Search. This will bring up any variable/parameter that has your search term in its name/definition.

Load: After you have located a variable/parameter you would like to see displayed, click Load.

Continue: Click here if you would like to return to the previous menu.

Define; Block Diagram; Equations; Linkages

Exploring and Changing Parameters

One of the key features of Quick Scenario Analysis with Tree is the ability to change specific variables and parameters.

The image below shows you what menu becomes available to you if you click on one specific parameter from the tree located on the left of the Main Menu of Quick Scenario Analysis with Tree. You are presented with five options: 1.) select the parameter in order to change it; 2.) click on drivers in order to see what variables are affecting what; 3.) click on explain to see a causal diagram and an explanation of what affects this parameter;4.) click on view equations to see the mathematical equations that are used to determine this number or; 5.) click on define to see a brief definition of what the parameter is.

IMAGE http://www.du.edu/ifs/help/use/scenario/quick/exploring.html

Spend as much time as you would like exploring the drivers, equations, definitions and explanations of various parameters. For this exercise, select TFRM. You will be asked to select a country or group. You can toggle between countries and groups at the top of your program window. For this exercise, choose France.

Because you selected a multiplier, the base-case value is always "1"—the model uses multipliers to easily raise or lower base-case values of many variables, and the multipliers are always "1" in the base case, so that values are unchanged by them. A multiplier can be distinguished from a variable because the ending of most multiplier abbreviations is the letter "m". You could use the Fully Customize option to create any pattern of intervention over time you desire, and at some point you should explore its use. But for now select the High option above the graph and note the change in the figure. This option will phase in a higher fertility for France.

You may also want to more specifically customize the TFRM. This can be accomplished by changing the speed in which your increase or decrease in TFRM takes place (through the slide-down menu on the top right, "Shift Years:"). If you would like more control over your parameters, you can click on the Fully Customize button located below the graph. This will present you with a menu. This will allow you to very specifically change your parameters. Click on the Next Year or Previous Year options to see the numeric representation of how your parameter is being altered from the base-case. You can then choose what year you would like to specifically change, toggle to that year, change the value of that year by clicking on the box next to Desired Value. After you have entered your value, click on the Change/Repeat button to enter it into IFs. This change can then be interpolated for your remaining years by clicking on the Interpolate button. To apply your changes to IFs, click on Exit to Scenario Tree.

Multipliers, however, are not the only form of parameter in IFs. If you select a parameter located under the Selected Initial Conditions category, as the name suggests, you will be able to change initial conditions for certain parameters. For example, the HIV infection rate, initial percentage sub-sub-category (Selected Initial Conditions, Demographic – Mortality) will let you numerically alter the initial percentage of the population infected with HIV for your country or group.

If you choose other parameters, for example, the Carbon Tax (Governments/Socio-Political Systems, Environment), you will be presented with a parameter that numerically begins at zero. This is because there currently is no carbon tax in place. You may change the parameter to take into consideration a future world where carbon taxes are a reality.

Finally, if you choose a parameter in the Relationship Parameters category, you will be able to change the relationship between two different parameters. You may want to change the mathematical relationships in the "black-box".

If you have mistakenly changed a parameter and you would like to remove your alteration, simply click on the parameter change you would like to remove and then click on the Delete Selection option at the top of the menu. You will be asked whether you would really like to delete your parameter change. Click Yes.

Now you have changed a parameter, but it will affect nothing else until you run the model and recalculate all of the variables in it for all of the countries. You have created a Scenario-Load-File (.sce) and, in order to use it more broadly, you need a Run-Result-File (.run). Click on the Run Scenario option from the menu. Your parameter will first be loaded into the working file. You will then be shown the Running Scenario form. You can change the end year or leave it as is. Click on Start Run for IFs to create a new run-file based on your specifications.

After IFs has recomputed the model with your new parameters and saved it as a .run file, you will be presented with a screen that says, "Run Successful – Click to Continue." The run-file labeled "Working File" is now essentially your personalized scenario. Use the techniques you learned in the last section to compare the working file with the base case. But your intervention will have changed much else. Look, for instance, at Gross Domestic Product (GDP) of your country before and after the intervention and at GDP per capita (GDPPC). If your country or grouping was fairly large, you will see changes in many variables elsewhere around the world.

Now return to the Scenario Tree form and select the Scenario Files option, Name and Save sub-option. Give your scenario a name and the parameter intervention (but not the full results after your run) can be saved for you when you return to IFs later. If you are using the stand-alone (non-Web) version of IFs, the Scenario Analysis/File Management/Save option sequence also allows you to save all the computed results of the model run.

Parameter Types

Parameters are numbers that determine relationships among variables in the equations of IFs. You often set parameters to a single value across time and they therefore do not always "vary" as do "real" variables. Many parameters are "policy handles." More generally, parameters can actually be thought of as a special type of variable, the value of which you set in order to determine the behavior of the model.

Multipliers. They have a normal value of 1, and to increase whatever they multiply (say agricultural yield) by 50 percent you increase the parameter to 1.5. To decrease it by 25 percent you would decrease the multiplier parameter to 0.75. You will almost always spread such changes out over time, keeping the multiplier's value at 1 in the base year and gradually increasing or decreasing it over a period of years. You should almost never change a multiplier in the initial year because the model is set up to provide accurate results for that year and will compensate for and thereby offset your change. For instance, if you set a multiplier on food production equal to 1.5 for the first year and all years thereafter, you might find that the results were no different than in the base case. You must instead gradually introduce your change, preserving the multiplier value of "1" in the initial year. Examples of multipliers include: AGDEMM, ENPM, FREEDOMM, MORTM, PROTECM, QEM, RDM, RESORM, TFRM, and YLM. Note that multipliers typically end with the letter "M".

Additive Factors. Most have a normal value of 0, thereby leaving that to which you add them (it could be exports) unchanged. How much you would add to achieve a 50 percent increase might depend on the amount to which you added it. Most additive parameters are, however, applied multiplicatively to the quantity they modify (that is, 1 plus the parameter is multiplied times the quantity), thereby scaling the parameter. In that case, the base or normal value of the parameter will be zero, but one can achieve a 50 percent increase in the quantity modified with a value of 0.5 and a 50 percent decrease with -0.5. You will very seldom want to change the base year value of additive parameters because it will either incorrectly change model results in the base year or, more likely, will result in model compensation to protect initial model results. An example of an additive parameter is: XSHIFT. Although earlier versions of IFs used additive factors and multipliers with comparable frequency, most additive factors have been replaced by multipliers to standardize most parameter change.

Exponents. For instance, many "elasticities" raise something to a power. For these parameters the "normal value" will vary greatly, but they will most often fall between -2 and 2, with many clustering around 0. In most cases it will make sense to change these parameters for all years including the first - generally the model will not use them in the first year and they will affect results only in subsequent years. Elasticities in IFs include: ELASAC, ELASS, ENGEL, and PRODME.

Reactivities. These are factors that relate growth in one process to growth in another. Although many will range between -2 and 2 (with 0 eliminating linkage of the processes), some have very large values. They are very much like elasticities, but the formulations that use them do not have exponential form. Reactivities include: CDMF, CPOWDF, CWARF, NWARF, and REAC.

Growth Rates. It is possible to force some processes to grow at specified rates. More commonly, the specified rates serve as targets and the dynamics of the model often shift actual growth rates somewhat, necessitating experimentation with targets to achieve a desired growth. Examples include: EPRODR and TGRLD.

Allocating coefficients. Coefficients are often used in multiplicative relationships with other variables, but many such coefficients are not what were earlier called multipliers (with a base value of 1). Instead they can serve an allocating role. For instance, eyou can use parameters to allocate governmental spending to health, education, and the military. Allocating coefficients frequently have values between 0 and 1. Again, you should generally not change these parameters in the initial year because the model will often compensate for changed values in the first year. Instead, change them by series over time. Allocating coefficients in IFs include: AIDLP, AIDV, CARABR, DRCPOW, DRNPOW, GK, LAPOPR, NMILF, REPAYR, and RFSSH.

Transforming coefficients. Some coefficients transform units of variables or link variables in other ways. Examples in IFs are: CARFUEL1, CARFUEL2, CARFUEL3, and FRQK.

Variables. This category should technically not be called parameters at all. They could and would be computed endogenously, if the model included the appropriate theoretical structure. They generally do not determine the interaction of other variables. Such variables include: AQUACUL and OFSCTH.

Initial conditions. Again, these are not strictly parameters, but rather first-year values for variables subsequently computed by the model. Although many initial conditions, like the population (POP) of the U.S., are sufficiently well-known that they should not be changed by model users, others, like the ultimate availability of oil and gas resources are only reasonable guesses. Thus users should feel free to change some initial conditions based on new data or even simply to test the implications. This category includes a great many variables, such as: LD and RESOR.

Switches. These parameters turn something on or off. They generally take on values of 1 (on) or 0 (off), but can have additional settings. For instance, some switches not only turn on some process, but set a key value within it (like the level of energy exports). Switches are most often on or off for the entire run, but it sometimes makes sense to "throw a switch" in the middle of a run. Switches allow you to fundamentally alter the structure of a model. Switches include: ACTREAON, AGON, ALLY, ENON, ENTL, ENPRIX, and SQUEEZ.

The focus here is on exogenous parameters only - on those elements of the model that you can change. Many computed variables are used in the computation of other variables in the same way that parameters are, as multipliers, additive factors, coefficients, and so on. You can display those, but unlike true parameters, you cannot change them.

Customization of Parameters

Access to time-variant parameter specification (the Change Values form) can be from either guided scenario analysis or self-managed scenario analysis.

Although most modeling discussions portray parameters as if they should be fixed over time, that is a very limiting conceptualization of them. In fact, it is normally better to specify parameters so that a particular phenomenon (e.g., a change in values concerning fertility, a policy-influenced movement towards higher savings rates, or a development of renewable energy technologies) phases in over time.

Alternative Ways to Use the Change Values Form:

Use the Slider Bar to Change a Parameter for All Years. You move the slider to the left or right to change the parameter value and then touch the Register Change button to actually change the parameter.

Specify a Desired Value for One or More Years. You specify a desired numerical value, indicate the number of years you wish to repeat that value (one or more) and then touch the Change/Repeat button.

Interpolate to a Desired Value over Several Years. You specify a desired value, indicate the number of years over which you wish to interpolate to that value, and then touch the Interpolate button.

Move Forward or Backward Across Years. You touch the Previous Year or the Next Year buttons to move across time without changing parameter values.

Cancel all Changes. You touch the Cancel all Changes button to revert to the parameter values before you began making changes.

Example. Try increasing the value of agricultural yields (YL) in Mexico by raising the value of a parameter called "ylm" from 1.0 in the initial year to 1.3 in 2020. That would build in an assumption of a 30% increase in the productivity of African agriculture, relative to the base case. To do this, select Scenario Analysis from the Main Menu and the Self-Managed Scenario Analysis sub-option. On the Self-Managed Scenario Analysis form select the Change option and Full Set sub-option. Specify ylm and choose Mexico as the country/region. Success in doing that will take you automatically to the Change Values (time-variant parameter specification) form. Designate 1.3 as the desired value to which you will interpolate (that is, move gradually over time) and indicate the number of years for the interpolation (say 20). Select the interpolate action option to carry it out. Then identify 1.3 as the desired value you wish to repeat (that should already be done for you), 100 or some other large number as the years to repeat, and select the change/repeat button. Exit and select the Display option. Select ylm for display, and look at it in a table or graph to make sure you have changed this parameter as you desired. It is often a good idea to check the success of a parameter change before running the model.

Understanding Model Computations

It is critical that there be as much transparency as possible with respect to computations that underlie the variables chosen for display. In a large, integrated model, achieving such transparency is not simple. You are invited to look at the very extensive Help section called "Understanding the Model: ‘Opening the Black Box’" for extensive documentation via flow charts, equations, and computer code.

While working with display of variables, however, there are several ways in which to drill down for explanations of what lies behind their computations. After you have added variable or parameter changes to the Quick Scenario with Tree you can learn more about how a parameter or variable is generated by clicking on it and exploring the options.

Change Selected Functions

Variables are forecast based on mathematic relationships that are represented by functions within IFs. These functions can be changed by users based on different understandings of relationships between variables. Users of IFs can change relationships between two variables or multiple variables . Follow the links below to learn more about how to change these relationships.

Bivariate Functions

Begin at the Main Menu of IFs. Choose the Change Selected Functions option under Scenario Analysis. Then choose the Bivariate Functions sub-option. That will give you the Change Bi-Variate Functions window, below.

IMAGE http://www.du.edu/ifs/help/use/scenario/change/bivariate.html

To see the full list of functions or relationships that you can change in IFs, check Extend List. Click on any of the relationships in the Functions list box in order to see the relationship already in IFs.

There are two ways to specify relationships in IFs. The first is called a "table function." Table functions allow you to specify two or more points in a relationship and let IFs connect those points with lines to create the relationship. This is very simple because you need not understand equations. The second is via "analytic functions" or equations. Look at each in turn.

Option A for Specifying Relationships: Table Functions. Click on the "Play around with this" relationship so that you can do just that. In the Table Function Points frame, you see boxes for specifying new or changing old X-axis and Y-axis values. Let’s start by adding a point to the five that already make up the table function. Specify 7 as the X-axis value and 8 as the Y-axis value. Touch the Add button and the point will be added, creating a relationship between X and Y that increases to a point and then starts down. Try specifying 1 as the X-axis value and 8 as the Y-axis value, then touching the Alter button. Now you have a relationship that starts downward, climbs, and then drops. Table functions give you nearly unlimited control over the form of a relationship. You can always touch Reverse Changes to return to the original form. As it says, play around.

Option B for Specifying Relationships: Analytic Functions (Equations). Click again on the "play around with this" relationship. This time, however, touch the Analytic Function button to call up the following screen.

IMAGE http://www.du.edu/ifs/help/use/scenario/change/bivariate.html

If you do not understand equations, you may want to skip this part of the lesson - table functions can serve you well.

But you can create a simple analytical function by specifying the constant (a) as 20 and the logarithmic parameter (b4) as 3. Leave the other parameters at 0. Note that by selectively specifying various parameters you can create a wide variety of analytic functions (including most of those that Excel will create when you fit lines to scatter plots). You may also specify the lower and upper range over which you will allow the independent variable to vary. For instance, you may not want the independent variable to be negative.

Save and Continue returns you to the Change Functions window and displays the analytic form you have specified. Note that the function you have created looks much like the one that Excel fit to the relationship between GDP per capita and life expectancy in Lesson 4. You now have the capability of discovering relationships and good analytic representations of them using Excel on the country-specific data base in IFs and then taking those relationships into IFs itself.

When you Exit from the Change Functions window, IFs gives you a very important informational warning. If you have made any changes to functions, those will remain active only until you exit from IFs. Starting IFs again resets all functions to standard values. Moreover, although runs of the model that you make with altered functions will reflect your changes, no information about the changed functions is saved with the .RUN files. You must keep track of the changes you make in functions.

After you have changed one or more functions, you can run the model and create a new working file that reflects the changed functions and their impact on all computations in IFs. You can compare that working file (or a saved version of it) with the base case or with other scenarios.

Multivariate Functions

Begin at the Main Menu of IFs. Choose the Change Selected Functions option under Scenario Analysis. Then choose the Multivariate Functions sub-option. That will give you the Change Multi-Variate Functions window, below.

IMAGE http://www.du.edu/ifs/help/use/scenario/change/multivariate.html

The form has two grids. The top grid shows a list of all multivariate functions in the model. The bottom grid shows the independent variables and parameters in a particular function, whichever function is high-lighted in the top grid.

  • Intercepts: Change the intercept value for the function by double-clicking on the value in the intercept cell of the function of interest in the top grid.
  • Other Parameters: Change parameters associated with specific independent variables for a selected function by clicking on the appropriate cell and changing values as desired. The general function at the top of the form explains the meaning of each possible parameter for independent variables. Normally, of course, most parameters will be zero (or null which means 0).

This feature of the model is in early stages of development. Some functions listed are not actually used in the model. Those for State Failure are used and changes in functional form will affect model behavior.

Changing functions gives you a powerful tool for using IFs to investigate possible futures. To an extent, it allows you to change the model itself.

Guided Scenario Analysis

Next to displaying output from IFs, the biggest use of the modeling system for most people is creating and investigating alternative run-files/cases of the model or elaborated scenarios.

scenario is a story about the future. The base case is such a story and you can create others and compare/contrast them.

There are two scenario development modes in IFs, Guided Scenario Analysis and Self-Managed Scenario Analysis. New users of IFs, and especially users who have no experience with scenario analysis, may prefer Guided Scenario Analysis. Returning users and those who understand the basics of scenario analysis are likely to prefer Managed Scenario Analysis.

To reach Guided Scenario Analysis, choose the Scenario Analysis option from the Main Menu and the Guided Scenario Analysis sub-option. That will take you to the following window and a list of the six steps of Guided Scenario Analysis.

image http://www.du.edu/ifs/help/use/scenario/analysis.html

After you have read the list, click on the Continue Guided Use button. You will be asked for your name (or some identifier you want to provide), so as to keep track of subsequent choices you make and simplify later return to Guided Scenario Analysis. After provision of an identifier, you will be taken to Step 1.

Step 1: Exploring the Base Case

IFs provides standard reports and specialized displays to get started with displays, and also offers flexible display options across all variables and parameters of the model. Lesson 1 elaborates the process, and this lesson assumes that you have mastered display from IFs. Note the Basic Report, Specialized Displays, and Self-Managed Flexible Display options on the menu. These should be familiar to you from Lesson 1, and you can use them at this stage if you want.

image http://www.du.edu/ifs/help/use/scenario/analysis.html

When finished exploring the base, the Next option will move you to Step 2 and the following screen.

Step 2: Identify a Geographic Area of Interest

This might be a country/region or a more aggregated geographic grouping, possibly the entire world. Touch the Countries or Group option and a list of geographic units will appear. Make your geographic choice and the screen will confirm it for you. You can change this choice now or later, so do not agonize about it. When you have completed your selection, choose the Next option on the menu to advance to Step 3.

image http://www.du.edu/ifs/help/use/scenario/analysis.html

Step 3: Setting Priorities

The Step 3 screen identifies a small selection of IFs variables in 4 main categories that have been chosen to help monitor the system when scenarios are introduced. Each has an initial weighting of 5 on a 1 to 10 scale (higher is more important). The model computes average weightings automatically for each subcategory and category. There is a more extended Help topic for Setting Priorities. At this point you only need to know a few things:

  • You can double-click on any variable name to bring up a small window that allows you to adjust the priority weight for that variable. Pick a variable of special importance to you as a priority for your country/region or geographic grouping, double-click on it, and increase its weight.
  • The Define Priorities option on the window will bring up a secondary window that allows you to change the variables in the priority list. Essentially, any variable in IFs can be added and any of the ones shown can be removed. Explore that if you like, but it may be unnecessary for you at this point.

image http://www.du.edu/ifs/help/use/scenario/analysis.html

The Reset option on the Set Priorities menu will reset priority weights back to the default values if you choose to do so after experimentation. When finished tailoring priorities, select the Next option to move to Step 4.

An additional feature of this screen is the Define Priorities option. By clicking on this at the top of the Set Priorities for Improvement of Life menu, users are able to alter which variables and parameters are given priority. Click on this and a new window will appear. From this screen, users are able to add additional variables/parameters to the guided use by toggling between "yes" and "no" under the GuidedUse column. At the bottom of this screen, it is possible to restore the default settings by clicking Reset G.U.

Step 4: Specifying a Scenario with the Scenario Tree

The scenario tree allows you to select one or more interventions without even knowing parameter names. You can select High, Medium, or Low values of many key parameters/scenario drivers and the tree will help manage your input scenarios.

image http://www.du.edu/ifs/help/use/scenario/analysis.html

Note that the tree (think of it as a tropical banyan tree that grows extra trunks over time) has several major trunks, each of which has branches that you can expose when you click on the + sign next to the trunk’s name. The first two trunks guide you to branches that correspond to assumptions about alternative technological futures and environmental conditions, respectively.

The next three trunks contain branches that help you represent changes in the behavior of key agent-classes in society: households/individuals, governments, and firms. Behavioral changes of such agent-classes can have significant impact on the future.

The last trunk contains a large number of branches that lead to parameters inside the model relationships. For most users, these parameters values will not be altered. This trunk is most for advanced users.

The best way to learn how to use the tree is to walk through an example. Let’s make a greater investment in education in order to explore whether it would help or hurt the country/region or grouping. Click on the "+" next to the Government/Socio-Political trunk and expose the branches. Click on the Fiscal-Expenditure branch to expose the specific drivers or parameters (or twigs) available. Click on the "Government expenditures by destination, multiplier" twig to get access to control over different kinds of government spending (the "Government expenditures on education by level, multiplier" would help direct spending to primary, secondary, or tertiary levels, but the current interest is in total spending).

A menu will pop up with several options that provide you much more information about the parameter on this twig; you might want to explore some of them to learn about the parameters and its impact on the model. Ultimately, however, choose the Select option. When you do so, you will be given a chance to identify the country/region or grouping where you want educational expenditures to increase. The default will normally be the one you identified earlier and you can just touch the Enter key on your keyboard to accept it. Then you will be given a chance to identify the area of government spending of special interest to you. Click on Education. The window will change and you will see a repainting of the scenario tree like that below.

image http://www.du.edu/ifs/help/use/scenario/analysis.html

The tree now shows the branch and twig you have selected. A graphic has appeared that allows you to change the value of the parameter you have chosen. Note that the default option specified is that of the base case and that the graphic shows it as a value of "1" across time. These means that the multiplier on educational spending for your country/region or grouping is "1" at all points in the base case, allowing the model to determine the level of educational spending based on the data and equations in it.

Now, however, you want to force more education spending. Click on the High option. The graph will change and you will see that the multiplier ramps up to a higher value over a period of several years (it is hard to change education spending very quickly). The Shift Years box would allow you to ramp up faster or more slowly. The slider bar on the side of the graph would allow you to ramp up (or down) to higher or lower values. The Fully Customize button would take you to a specialized Change Values screen that provides total control on the time path of intervention.

For now, just choose the High option as your intervention. Click on the Next button to advance to the next step. When you do so, you will be asked to Save your scenario. Type in Test.sce some other name that you would like. Notice, however, that there are already many scenarios in the list of folders presented in this dialog box. For instance, Sustainability Scenario.sce contains a rather extended scenario that has interventions aimed at creating a more sustainable world by 2100. Other scenarios have interventions concerning faster or slower control of HIV/AIDS. Still others represent the scenario "families" of the Intergovernmental Panel on Climate Change (IPCC). At a later time you will want to come back to Step 4, use the Scenario Files option and the Open sub-option to load either your own "Test.sce" or another scenario into the tree as a basis for further analysis. The window of Step 4 is a powerful tool for developing and changing scenario packages over time.

Step 5: Running the Model

After you have changed a single parameter (or even many of them) in Step 4, everything else remains the same. This is very important to understand – you have only changed an input parameter, nothing more. To see the effects of your parameter change throughout the global system you must run the model, because it is the run that computes all the implications of all parameter settings. In the run of the model, nearly "everything effects everything" in IFs.

image http://www.du.edu/ifs/help/use/scenario/analysis.html

Note that you can identify the year to which the model should run, with a default value specified. For now, simply accept the default and touch the Start Run button. As the model runs you will see some selected graphics of variables changing over time at the global level. When it finishes, you will see a "Run Successful" message. You can click on either that message button or Next to advance to Step 6 of Guided Scenario Analysis.

Step 6: Reviewing the Results of Your Scenario

The screen below (or something similar in your analysis) contains a summary review of the results of your intervention.

image http://www.du.edu/ifs/help/use/scenario/analysis.html

This screen has the same variables that you saw in Step 3, with the weightings you either chose or left unchanged. It also has, however, several new elements:

  • Columns that show the value of each variable at the end of your end horizon (and for the country/region or grouping of your choice) from the Base Case and from the Working Run File generated by your scenario intervention. You will notice two things about those values. They are changed for most variables (everything affects everything) and the changes are not usually very great (it is difficult to move the world with a policy intervention).
  • A cumulative ratio of the values for each variable over the entire time horizon (the sum of values across time in the Working Run File divided by the sum across time in the Base Case).
  • Scores for each variable. 100 is the default score when nothing is changed by your scenario. Values above are positive and values below are negative.
  • The number in the Sign column indicates whether a higher numerical value for a variable would be considered positive ("1") or negative ("-1"). The signs are also set in the Define Priorities window, but most have default values with which you will agree.

An intervention such as higher educational spending might be expected to improve literacy rates, but because it squeezes health expenditures to lower life expectancy. Such an intervention may or may not raise levels of GDP per capita or to change income distribution and so on. Do the affects of your intervention seem reasonable? What do you think of your scenario? How might it be improved?

In this step you may spend some time learning more about the structure of the model and how it generated the results you obtained. For instance, you might use the Display features (again you will recognize the set of options from Lesson 1) to see more detail behind the basic review of results and to learn more about the relationships within IFs. You can click on tables of results to call up explanations of the variables in them. You may also benefit in your use of IFs by referring to a book written about the model and its use.

In general, scenario analysis is an iterative process involving thinking about results and learning from them, on one hand, and changing the intervention, on the other. When you are ready, back up to Step 4 and change your scenario.

Running the Model

This section of the Help Menu will further explain the options located under the Run sub-option located under the Scenario Analysis option on the Main Menu of IFs.

Users can change parameters in the Quick Scenario Analysis with Tree or load Scenario-Load-Files into IFs. These changes can then be turned into a Run-Result-Files. There are two different methods for creating these Run-Result-Files. It is possible to create one file using the Single Run function. It is also possible to create large numbers of Run-Result-Files in order to compare how they differently affect changes around one parameter or variable of specific interest to users. The second option is the Sensitivity Run function.

Sinlge Run

This menu item can be found by selecting Scenario Analysis from the Main Menu followed by the Run sub-option.

Use this IFs option if you would like to take your Working File and convert it into a Run-Result-Files. If you have changed parameters in your scenario tree, or you have loaded a previously structured scenario, select the Single-Run option under Scenario Analysis on the Main Menu of IFs.

This is not the most common way for users to create Run-Result-Files. Typically, these files are created through the Quick Scenario Tree.

This feature of IFs is also used after Rebuilding the Base.

After you have selected this option you will be prompted by a screen where you can specify for how many years IFs should run. Choose the year you would like the run to stop and then click Start Run.

Sensitivity Run

This menu item can be found by selecting Scenario Analysis from the Main Menu followed by the Run sub-option.

Analysis with alternative parameters helps map the degree to which variations in parameters affect outcomes (forecasts of variables). Often you want a fairly systematic view of how parameter changes will affect outcomes. Such a mapping can identify points of policy leverage that will most productively produce desired futures or elements of risk that most jeopardize those same futures.

Image http://www.du.edu/ifs/help/use/scenario/running/sensitivity.html

On the Main Menu of this feature, select Build Sensitivity Runs. From this menu you can access and accomplish the following:

Adding a single change to the set of sensitivity runs: This change is stored in a file called SensitivityInput.dat. The advantage of this option is that, after you select the parameter name and dimensionality, you have the option of customized or time-variant parameter specification.

Setting a change loop to the set of sensitivity runs: The change loop runs from a minimum to a maximum value for a selected parameter, depending on the step size or step number you specify. It has the advantage of allowing you to set up a series of runs (one for each step of the loop) with minimal difficulty. It has the disadvantage of allowing limited time-invariant parameter specification. Specifically, it is possible to select a period of years (the Shift Years) over which the stepped parameter changes will occur.

Select Sensitivity Output: From this menu you can access and accomplish the following:

Identify Output Variables: this feature allows you to identify and select on parameter that will be used as an output variable. Selecting this option will open a window that allows users to choose from variable used in IFs. From this screen, users can select variables by clicking on them. The user will then be prompted to select a country. The variables are also organized into categories and grouped into a box located in the bottom right corner. At the top of this menu, users are able to pull up a box explaining scenario output files by selecting that option from the Main Menu. Users are also able to, change variable selection options by clicking on that option on the Main Menu. The next option for users is to change historic variable options by selecting that menu option. Another option on this menu allows users to open up the IFs historic base. Yet another option on this menu allows users to search through the lists of variables by typing keywords.

  • Display Output Variables: This option allows users to see specific parameters that users have selected for display.
  • Clear Output Variables: This feature allows users to clear any variables that they have entered into the sensitivity menu.

Generate Sensitivity Runs: After you have selected various output parameters you would like to track, click on this option to see these runs actualized.

It is necessary to generate the sensitivity runs, which is a process that will use both the specification of sensitivity runs and the specification of output variables that you have created. This process actually involves iteration across three sub-processes: for each sensitivity run you have specified, the parameters you set are copied into the working file of the model; then the model is run, re-computing all variables; finally, the values for the variables you specified as output are copied into a new file named SensitivityOuput.dat. Each line of that file contains values for a single selected sub-variable from the initial year of the run to the final year. If prior to beginning the run you wish to change the final year from the default value, use the Horizon parameter on the Display menu (reached from the Main Menu).

Analyze Sensitivity Runs: This allows users to graphically display the various parameters they wanted to explore in more depth.

Analysis of the SensitivityOuput.dat file will generate insight into the relationship between parameter variation and variable values in forecasts. Normally statistical and/or graphical analysis will be involved. At this point, IFs does not include limited options for that analysis (thanks for those to Sergei Parinov).

File Management

This section of the Help Menu will further explain the two options located under the File Management sub-option located under the Scenario Analysis option on the Main Menu of IFs.

The File Management option under the Scenario Analysis option on the Main Menu of IFs allows users to work with specific Run-Result-Files. These files can be converted into Working Files, saved, deleted or selected for display.

Open Run-File as Working File: This menu item can be found by selecting Scenario Analysis from the Main Menu followed by the File Management sub-option. Run-Result-Files are used to forecast different future scenarios. This option allows users to select one Run-Result-File to use as their working file.

After clicking on this option, users have the ability to select the Run-Result-File from a list of files. Some of these files may have been created by the user and some come standard with IFs software. Below is a list of some Run-Result-Files that may have accompanied your software:

image http://www.du.edu/ifs/help/use/scenario/filemanage.html

Select one Run-Result-File and it will then be incorporated into IFs as your Working File. Display this Run-Result-File as your Working File throughout the Display option of IFs located on the Main Menu.

Save Run-File as…: This menu item can be found by selecting Scenario Analysis from the Main Menu followed by the File Management sub-option. Working Files are used to display one future scenario based on specific parameter and variable relationships.

If you would like to save your current Working File under a specific name, click on File Management and then Safe Run-File as… This option will allow you to take your current Working File and save it for future use. Learn more about how to create Run-Result-Files, incorporate them into IFs display and change parameters.

Delete File: This menu item can be found by selecting Scenario Analysis from the Main Menu followed by the File Management sub-option. If you have redundant Run-Result-Files, click on the Delete File option found under the File Management option. This will pull up a menu that allows you to select and delete specific Run-Result-Files that you no longer need.

Select File for Display: This menu item can be found by selecting Scenario Analysis from the Main Menu followed by the File Management sub-option.