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Compressive hearing aids automatically reduce their gain with increasing sound level to accommodate reduced dynamic ranges in sensorineural hearing loss. Hearing-impaired people can also benefit from waveform compression that strengthens consonant sounds relative to vowels (E. Villchur, 1973). The normal ear accomplishes both forms of compressive signal processing with instantaneously compressing bandpass nonlinearity (BPNL) filters (R.R. Pfeiffer, 1970) under efferent control. Guided by the development of this basic knowledge (J.L. Goldstein, 2001), we have implemented a real-time PC simulation of a multi-channel DSP hearing aid with programmable gain and waveform compression options. Prescription fitting is being developed through clinical study of patient preferences and speech intelligibility.