How does raising income tax affect government revenue? What are the costs and benefits of implementing a state pension?
Tax and benefit microsimulation is a useful technique for determining how policy changes affect the distribution of income and government expenditure. The UNU World Institute for Development Economics Research (UNU-WIDER) has played a key role in bringing microsimulation models to key countries in the developing world, with the primary aim of building capacity for evidence-based policymaking in these contexts.
Most recently, 24 government officials and researchers — including representatives from the Central Bank and the Ministries of Economic Policy and Finance — gathered in Quito for a training course for ECUAMOD, the Ecuadorian tax-benefit microsimulation model. The training, held in partnership with the Instituto de Altos Estudios Nacionales, aimed to introduce the microsimulation model created specifically for Ecuador to key stakeholders, as part of the SOUTHMOD project.
In addition to building participants’ abilities to use the tool, the training facilitated discussion between end users and organisers with implications for potential improvements and attention to how the model could further incorporate local practices. The training was preceded by meetings with government institutions to give an overview of the model, and generate interest in what ECUAMOD can offer.
For more information, see the news story on the UNU-WIDER website.