nuffield/euromod-uk training course · 2019-08-01 · euromod in this course • euromod is...
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Nuffield/EUROMOD-UK training course
Paola De Agostini and Iva Tasseva ISER, University of Essex
1-2 April 2019
Course based on EUROMOD v. I1.0+
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Outline: Day 1 • Morning (9:30-13:00 with a break at 11:15)
o Tax Benefit Microsimulation and EUROMOD o Overview of EUROMOD Design o EUROMOD User Interface (UI)
Running EUROMOD Statistics Presenter tool Hands-on practice Handling Errors
o Documentation
• Afternoon (14:00-17:00 with a break at 15:30)
o EUROMOD functions and parameters o Income lists o Hands-on practice
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Outline: Day 2 • Morning (9:00-13:00 with a break at 11:00)
o EUROMOD Functions and Parameters (cont.)
o Hands-on practice
o EUROMOD Functions and Parameters (cont.)
o Hands-on practice
• Afternoon (14:00-17:00 with a break at 15:30)
o Assessment (tax) units in EUROMOD
o Hands-on practice
o Using EUROMOD after the course
o Q&A
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Tax-benefit microsimulation and EUROMOD
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Tax-benefit microsimulation models (1)
• Two main elements
o micro-data on households (and individuals), representative of the population
o tax-benefit policy rules
• Calculations of benefit entitlements and tax liabilities
o for each household
o for the existing system and a policy reform
• Used to analyse impact of policy changes on household net incomes, the fiscal budget and work incentives
• Account for
o interactions between policies
o interactions between policies and household characteristics
o heterogeneity of household characteristics
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Tax-benefit microsimulation models (2)
• Several types of model: “static”, “dynamic”, “behavioural”
o “static” models can incorporate elements of dynamic modelling and can be linked to behavioural models
o EUROMOD is a special static tax-benefit model
• Key data issues
o Micro-data requirements
o Policy scope driven by micro-data content
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What are tax-benefit models used for? • Analyse the impact on household incomes of policy changes over time,
holding other things constant (decomposition: “understanding” as well as “monitoring”)
• Analyse the impact of policy changes on the distribution of target variables, rather than o on the mean, as happens using regression techniques o on individual cases, as happens using OECD-style standard family type calculations
• Weighted results can be used to calculate
o distributional impact of policy changes
o budgetary cost of policy changes
o work incentive indicators
• Added value to survey/register microdata
o information which is otherwise not (publicly) available o e.g. tax deductions, benefit eligibility, net/gross values
• More up-to-date results (as data collection and release take time)
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What is EUROMOD? EUROMOD has all the characteristics of static tax-benefit models and more:
• EUROMOD is freely available
o household micro-data from EU-SILC, for the UK from the Family Resources Survey
• 28 EU-countries implemented using a common framework
• High flexibility and transparency
o no hard-wiring; everything is parametrised o (relatively) easy to simulate structural reforms o extensive documentation o a “community” of users
• EUROMOD-UK has broadly similar scope and functionality to
o UK government models o IFS and other independent models o (Indirect taxes)
• Any differences in results between EUROMOD-UK and other UK models due to:
o different input data o choice of technical adjustments e.g. to take-up o analytical choices
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EUROMOD: ways it can be used
• Simulate actual, proposed or illustrative changes to tax-benefit rules
o complex reforms (e.g. revenue-neutral packages, policy swaps)
o counterfactual (“what if”) scenarios (e.g. stress test for unemployment shocks)
o design regional/national/EU-wide policy reforms
• Single country, cross-country comparative, or EU-level analysis
• Tax evasion and non-take-up simulation/calibration (special data)
• Expert users can o link to labour supply or macro models
o extend policy scope (with additional data)
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Who uses EUROMOD?
• Academic research: public economics, quantitative social policy
• International policy organisations o European Commission policy Directorates o OECD, IMF, World Bank, UNICEF (hands-on & commissioned work)
• National governments and public institutions
o SK, MT, LT, LV, EE, EL …. o Scotland (SPICe), Welsh Government, NHS Scotland
• Civil society: EUROMOD is the engine for simplified web-based models
o SORESI – run by Austrian Ministry of Social Affairs http://soresi.sozialministerium.at/soresi/#
o Mefisto – for Flanders run by CES at KULeuven http://www.flemosi.be/easycms/mefisto
• A platform for developing non-EU models
o e.g. Africa (South Africa, Namibia, Mozambique, +4), Latin America (Ecuador, Colombia, +…), Russia, Serbia ...
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Example: hypothetical reforms • Changing child-related elements of Universal Credit in Scotland
Source: De Agostini P. & N. Hudson (forthcoming) SPICe Birefing Notes: analysis for Scotland with EUROMOD; reintroducing family element of UC, doubling child element and removing two-child limit
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-10
12
34
56
% c
hange
1 2 3 4 5 6 7 8 9 10 AllIncome decile group
Market income NICs Income Tax
Net Council Tax State Pensions Non Means-tested bens.
Means-tested bens. Net change
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Example: actual policy changes • Decomposing the change in real net income due to policy
changes in 2011-2014 by tax-benefit policy
Source: De Agostini, Paulus & Tasseva (2016), EUROMOD Working Paper 6/16 Notes: using the Policy Effects Tool in EUROMOD
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-5
0
5
1 2 3 4 5 6 7 8 9 10
Belgium
-5
0
5
1 2 3 4 5 6 7 8 9 10
Bulgaria
-5
0
5
1 2 3 4 5 6 7 8 9 10
Czech Republic
-5
0
5
1 2 3 4 5 6 7 8 9 10
Denmark
-5
0
5
1 2 3 4 5 6 7 8 9 10
Germany
-5
0
5
10
1 2 3 4 5 6 7 8 9 10
Estonia
-5
0
5
1 2 3 4 5 6 7 8 9 10
Ireland
-10
-5
0
5
10
15
20
1 2 3 4 5 6 7 8 9 10
Greece
-5
0
5
1 2 3 4 5 6 7 8 9 10
Spain
-10
-5
0
5
1 2 3 4 5 6 7 8 9 10
France
-5
0
5
1 2 3 4 5 6 7 8 9 10
Italy
-5
0
5
1 2 3 4 5 6 7 8 9 10
Cyprus
-5
0
5
1 2 3 4 5 6 7 8 9 10
Latvia
-5
0
5
1 2 3 4 5 6 7 8 9 10
Lithuania
-5
0
5
1 2 3 4 5 6 7 8 9 10
Luxembourg
-10
-5
0
5
1 2 3 4 5 6 7 8 9 10
Hungary
-5
0
5
1 2 3 4 5 6 7 8 9 10
Malta
-5
0
5
1 2 3 4 5 6 7 8 9 10
Netherlands
-5
0
5
1 2 3 4 5 6 7 8 9 10
Austria
-5
0
5
1 2 3 4 5 6 7 8 9 10
Poland
-10
-5
0
5
1 2 3 4 5 6 7 8 9 10
Portugal
-5
0
5
1 2 3 4 5 6 7 8 9 10
Romania
-5
0
5
10
1 2 3 4 5 6 7 8 9 10
Slovenia
-5
0
5
1 2 3 4 5 6 7 8 9 10
Slovakia
-5
0
5
1 2 3 4 5 6 7 8 9 10
Finland
-5
0
5
1 2 3 4 5 6 7 8 9 10
Sweden
-5
0
5
1 2 3 4 5 6 7 8 9 10
United Kingdom
Cha
ng
e in m
ea
n d
isp
osab
le incom
e,
%
Income decile group
public pensions non pension benefits taxes and SIC
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Example: policy swaps
• Impact on household incomes of own and other countries’ child-related policies
Source: Levy et al. (2007), Journal of Social Policy Notes: households are ranked in decile groups based on their actual net income in 2003
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Example: work incentives • Decomposing the mean Marginal Effective Tax Rate by type of policy in
2015
Source: Jara, Gasior & Makovec (2017), EUROMOD Working Paper 3/17 Notes: METRs measure the incentive to work longer hours; calculations with the Marginal Tax Rates tool in EUROMOD
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Example: EU-wide reforms • Income Stabilisation Coefficient with and without EMU Unemployment
Insurance
Source: Jara, Sutherland & Tumino (2017), EUROMOD Working Paper 3/17 Notes: EMU-UI = European Monetary Union Unemployment Insurance benefit. ISC measures how much of the earnings loss is retained through tax-benefit policies
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Example: Behavioural reactions • Calculating labour supply elasticities
Source: Bargain et al. (2013) Journal of Human Resources
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0
.2
.4
.6
.8
Ow
n-w
age
ela
stic
ity
EE
05
UK
01
PL
05
SW
01
FR
01
FI9
8
PT
01
US
05
HU
05
DK
98
BE
01
GE
01
IE0
1
NL
01
IT9
8
AT
98
SP
01
GR
98
Married women
0
.2
.4
.6
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Ow
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UK
01
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PL
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IT9
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FR
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AT
98
SP
01
US
05
HU
05
EE
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GR
98
BE
01
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DK
98
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1
Married men
0
.2
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ela
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ity
PT
01
NL
01
PL
05
AT
98
FR
01
HU
05
EE
05
GR
98
SW
01
US
05
GE
01
UK
01
IT9
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DK
98
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01
IE0
1
Single men
0
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.8
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PT
01
HU
05
PL
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DK
98
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98
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SP
01
FI9
8
SW
01
US
05
UK
01
IE0
1
GR
98
BE
01
IT9
8
Single women
Point estimate 95% confidence interval
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EUROMOD in this course • EUROMOD is continuously being developed and improved
• Software version: 3.0.2
• Latest public release (I1.0+)
• Countries and policies o All 28 EU MS implemented
o UK model – policy years (systems) for 2005-2018 Universal Credit is not included in the current version of the model but will be
in the autumn release!
• Data o EU-SILC/FRS (UK) – the latest for 2015/16
o training data
o # of datasets available – depends on country
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Overview of EUROMOD design
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How does EUROMOD work?
Tax-benefit policy rules and parameters
(EUROMOD User Interface)
Input micro-data (FRS or hypothetical
households data)
Policy simulations (EUROMOD software)
Tools for analysis: Statistics Presenter (or statistical software e.g. Stata)
Output micro-data = input micro-data + additional simulated variables
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Original micro-data (FRS for the UK)
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EUROMOD input micro-data (1/2)
A. Based on survey household micro-data or administrative micro-data
o Only a set of variables from the original micro-data end up in the
EUROMOD input micro-data
those relevant for tax-benefit simulations plus some more relevant for
distributional analysis
if the user has access to both the original and EUROMOD micro-data, they can
combine the two files
B. Based on hypothetical households data
o Hypothetical Household Tool in EUROMOD generates hypothetical
households based on user-defined characteristics
o Abstracts from complexities of real data – focus on specific household
types
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EUROMOD input micro-data (2/2) • We provide you with the EUROMOD input micro-data, so you don’t need to
prepare it yourself
• Characteristics of the EUROMOD input micro-data
o Variables: demographic, labour, income, assets, expenditure
o Compulsory variables (e.g., id, age, weight, incomes)
o Harmonised data reference period
o Gross incomes, at the individual level
o Monetary variables recoded to (average) monthly basis
o No missing values
o Special variable name convention
o Text file
• Guidelines (see EUROMOD Modelling Conventions) and documentation (see Data
Requirement Document)
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Variable name convention • Concerns the variables defined in the EUROMOD input micro-data and used by
EUROMOD for policy simulations
• The goal is to achieve: o more intuitive variable names o harmonised variable names to allow for consistent cross-county comparisons
• Names are combination of acronyms: abb**
o a – type of information (e.g., y: income, x: expenditure) o bb – specific for each type a (e.g., y| em: employment, se: self employment), e.g.
yem: employment income yse: self-employment income
o ** further bb’s for additional information/detail, e.g. ysebs: business self-employment income
o exception id*, eg. idperson, idmother
• Acronyms and list of variables stored in a common Variables file (VarConfig.xml)
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EUROMOD policy rules and parameters • Policy rules/parameters are:
o coded using the EUROMOD ‘language’ set of (7-8) custom functions (and associated parameters) standardised ‘microsimulation language’ allow for both flexibility (parametrisation) and harmonised approach
o stored in xml files – ‘content’ files o manipulated via the EUROMOD User Interface (UI)
• UI-stand alone software based on .NET framework
• Scope of policy simulations:
o Social/national insurance contributions o Income tax o Non-contributory benefits (means-tested or not) o Contributory unemployment benefits (approximation) o Min wage
o Additional country-specific policies
EUROMOD-UK accounts for: – benefit non-take-up of means-tested benefits using estimates by DWP and HMT – increases to the statutory retirement age
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Policies simulated in EUROMOD-UK
• National insurance contributions
o paid by employees, self-employed and employers
• Contributory JSA
• Winter Fuel Allowance
• Child Benefit
• Personal income tax
• Tax credits (Working Tax Credit & Child Tax Credit)
• Income based JSA
• Income support
• Pension Credit
• Income based ESA
• Housing Benefit & Local Housing Allowance
• Council tax benefit/CT support
• Total benefit cap
• Minimum wage and National Living wage
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EUROMOD User Interface (UI)
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Installation
• Requires Microsoft .NET framework files or an Internet connection to download files in the SETUP process
• Complete separation between UI and ‘content’ (i.e. XML) files
• Only one copy of the UI but can use multiple ‘content’ files o think of working with Stata and multiple do-files, specific to different projects
• ...but content files must have set structure of folders
• Run the Installation Wizard
• Set the path to your EUROMOD files
o project path o (if necessary) separate input data and output data paths
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EUROMOD content folder structure
Input data sets
Country parameter files
Output data sets
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Set structure
of folders
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Linking the User Interface to EUROMOD content files (1)
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Linking the User Interface to EUROMOD content files (2)
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User Interface (UI) • Single stand-alone piece of software
• Mostly point and click but some hot keys are available (standard and specific)
• In-built features that allow for improved user control and guidance
• Intuitive!!
• Features:
o Ribbon bar with tabs
o Context menus
o IntelliSense (suggestion of parameter values )
o Drag and drop
o Bookmarks and comments
o Built-in help
o Display customization
o …much more
• New features and capabilities added over time
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User Interface (UI) 33
Run button
Ribbon bar
Country files
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Working environment
open country
by clicking
on a flag
policy systems
comments
policies
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Ribbon bar – country tools
Country tools: • Open country to activate buttons
• Contains options that manipulate the general parameters of a country file
o name and acronym
o available policy systems and their characteristics
o available datasets and their characteristics
• Adding and deleting systems
• Viewing options:
o search and replace
o formatting
o bookmarks
• Comparing versions
• More advanced (import/ export systems, add-ons etc.)
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Policy system settings
exchange rate
national to euro
parameters
currency
output currency
income used for
unit head
definition
all policy
years/systems
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Database settings
adding/
deleting
characteristics of
input dataset
all policy
years/systems
all input
datasets
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Display: • Control display and formatting
• View full spine vs. single policy
• Conditional formatting (similar idea to EXCEL)
• Bookmarks
• Matrix view of income lists
• Visualising/ hiding key parameters
Ribbon bar - control display and formatting
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Ribbon bar – administration tools 39
Administration tools: • Adding and deleting countries
• Accessing and administering the variables file
• Updating progress: overview of available policy systems and datasets
• Merging versions
• Administrating switches
• Administrating exchange rate and HICP series
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EUROMOD Help
browse search
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Context Menus 41
right-click on
a policy,
function or
parameter
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Context Menus
• Activated by right-clicking o column headings o row headings o function headings/ parameter names o comments
• Intuitive options controlling the respective
elements
• Description available
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IntelliSense 43
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Variable Administration
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Variable Administration
list of all variables
defined in the
variables file in
alphabetical order
name
description of variable for
countries where it is used
automatic label
variable is monetary or non-monetary
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acronyms used for names
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Adding a variable
new empty row;
fill in name and monetary
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Naming a variable
acronyms
UI checks validity of name
and existence of the variable
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Running EUROMOD
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What does ‘running EUROMOD’ mean?
Tax-benefit policy rules and parameters
(EUROMOD User Interface)
Input micro-data (FRS or hypothetical
households data)
Policy simulations (EUROMOD software)
Tools for analysis: Statistics Presenter (or statistical software e.g. Stata)
Output micro-data = input micro-data + additional simulated variables
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Original micro-data (FRS for the UK)
It is the act of starting the
policy simulations!
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Running EUROMOD (1) 51
Run button
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• Two ways of Running EUROMOD:
o by clicking on button Run EUROMOD o by clicking on a country flag and then clicking on the button Run
EUROMOD
• We can run EUROMOD (simultaneously) for:
Running EUROMOD (2)
i) one country and one or more systems
ii) several countries (and systems)
iii) all existing countries and systems and for all existing data
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Running EUROMOD (3) 53
select countries by
clicking on flags
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Running EUROMOD (4)
select systems
select input micro-data
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Running EUROMOD (5)
select all
countries/
all systems
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unselect all
countries/
all systems
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Running EUROMOD (6)
filters
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red colour to remind us
that filters are applied
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Running EUROMOD (7) 57
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Running EUROMOD (8) 58
data and
systems
running
some details about
the calculations
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Running EUROMOD (9) 59
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EUROMOD output micro-data (1)
• Content manipulated in policy output_std_cc o Controls level at which info is outputted (e.g. individual, family or
household)
o What variables to be included in the output
• Usually including: o All variables present in the input micro-data file
o Simulated variables (i.e. simulated taxes and benefits)
o Standardised income lists (e.g. all benefits, all taxes)
o (optional) non-standard income lists
o (optional) temporary variables
o (optional) tax/assesment unit identification info
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EUROMOD output micro-data (2)
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name of output file:
cc_year_std
individual-level information
variables included in the
output file
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Statistics Presenter Tool
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Statistics Presenter Tool (1) • Statistics Presenter Tool is a quick and easy way for analysing the output
• Tool estimates
o distributional measures of income income poverty rates for the overall population and for selected groups income inequality measured by the Gini coefficient and S80/S20, by different income concepts distribution of household income, taxes and benefits by income group demographic information on households by income group
o fiscal costs government revenues and expenditures
• Tool calculates income statistics for
o a single country and policy system o several countries/policy systems o baseline and reform scenario and calculates difference in the income indicators o a particular type of income (e.g. income taxes) if stronger focus on that income
• Results can be exported in excel table(s)
• Selection of default indicators with the possibility of new templates
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Statistics Presenter Tool (2) 64
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Statistics Presenter Tool (3) 65
folder where your output file is stored
list of all output micro-data available
in the output folder
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Statistics Presenter Tool (4) 66
I have selected the 2015 output micro-
data first and the 2016 data second
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country and system for which
results are produced
one sheet per output micro-data
file (2015 first, 2016 second)
9 tables with results
Statistics Presenter Tool (5)
export results in excel
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Exercise 1
• Running EUROMOD and producing summary statistics
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Implementing a simple reform (1)
• Where: o Simpleland
• What:
o Increase the child benefit amount from 200 to 250 per month
• How:
o Open Simpleland o Find the relevant policy o Add a new system where your reform will be implemented
• Compare impact on household incomes of the baseline and reform
o Run EUROMOD to produce output micro-data o Analyse results with the Statistics Presenter tool
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Implementing a simple reform (2) 70
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Implementing a simple reform (3) 71
The benefit is 200 per month for
each dependent child in the
family
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Implementing a simple reform (4) 72
type in a reform system name
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Implementing a simple reform (5) 73
reform is identical to the baseline
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Implementing a simple reform (5) 74
new amount; difference compared
to baseline is highlighted
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Implementing a simple reform (6)
produce output for both the
baseline and reform
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Implementing a simple reform (7)
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Implementing a simple reform (8)
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Implementing a simple reform (9)
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Handling Errors
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Handling errors (1) 80
typo in the syntax
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Handling errors(2) 81
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Handling errors (3) 82
unique identifier for the exact place of the error in the model
location of the error
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Handling errors (4) 83
search for identifier
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Handling errors (5) 84
copy unique identifier from error log and paste it here
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Handling errors (6) • Output folder-error log file (text format)
• Same info as in the running dialog box
• Error logs contain time stamp of their creation
• Info about EUROMOD version, policy system where error occurred
and dataset used
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Documentation
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Documentation • Manuals
o EUROMOD Terminology o Running EUROMOD and Basic Concepts o EUROMOD Functions
• Country Reports (CR)
o https://www.euromod.ac.uk/using-euromod/country-reports
• EUROMOD Modelling Conventions (EMC)
o https://www.euromod.ac.uk/publications/euromod-modelling-conventions
• Data Requirement Document (DRD)-1 per dataset
• EUROMOD Working Paper series
o https://www.euromod.ac.uk/publications/type/EUROMOD%20Working%20Paper%20Series
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all in built-in help
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Country Report
• Main document accompanying the model
• Provides information about: o tax-benefit system
o model
o underlying data
o accuracy of simulations
• The latest UK CR covers the policy systems o starting from 2015 (matching the latest
available FRS 2015/16)
o until 2018
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Country Report cont. 1. Basic information
o background information o brief description of all policies
2. Simulation of taxes and benefits in EUROMOD
o scope and order of simulation o detailed description of simulated policies (incl. assumptions)
3. Data o general description and references to original data documentation o data adjustment, imputations and assumptions
4. Validation against external statistics o aggregate amount of income component o number of benefit recipients/tax payers o income distribution: mean/median equivalised hh net income, decile shares o Income poverty and inequality o “health warnings”
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EUROMOD functions and parameters
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EUROMOD functions
• Building blocks to implement policies o Parameters stored in XML and manipulated via the UI
o Calculation by the EUROMOD software
o ‘EUROMOD language’ flexible
harmonised
parameterised
sufficient
transparent and documented (in-built HELP)
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Structure of a function
Function name
Switch: on / off / n/a / toggle
Parameter names
Parameter values
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Types of function
• System functions o functions used to define some general settings
o E.g. uprating, default values for datasets, etc.
• Policy functions o functions used to implement tax-benefit policies
o E.g. define eligibility, calculate amount, etc.
• Special functions o more advanced functions that perform more complicated tasks
o E.g. loops, change parameters at run-time, etc.
o (not covered in this course)
93
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Manipulating functions 94
right-click on
a function or
parameter
name to
activate
menu
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Policies • Block of functions that complete a policy simulation • Can be manipulated independently
o switch – affects all functions in the policy o can be copied / moved o same policy may be repeated by simple referencing
• Policy names end (usually) with the country acronym o policies can have any name ...but in practice we use naming conventions
• The comment (comments column) explains what the policy intends to simulate
• Policies can be:
o common to all countries (e.g. defining output) o country specific (e.g. means-tested child benefit for single parents)
• Order of policies is called the ‘spine’
95
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Policies cont. policy description policy switch
policy name
policy made up of 3 functions
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Manipulating policies 97
right-click on
a policy to
activate
menu
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98
Policy functions Elig & ArithOp
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Function Elig • Used to implement conditions
• Condition is defined in parameter elig_cond
• Creates a variable which is equal to 0 or 1 (by default sel_s)
• Subsequent functions use this information via parameter who_must_be_elig
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Function ArithOp • Arithmetical calculator
• The parameter formula contains some calculations
• The result is stored as output variable via parameter output_var
100
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Parameters
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Parameters (1) • Can be:
o common to several functions or specific to one function o compulsory (i.e. error generated if not used) or optional
which parameters are compulsory/optional depends on the function
• Order of parameters in a function is not important
o but order of functions in a policy is!
• Manipulated via context menu (right-click)
o only relevant parameters for the given function are shown
• Drag & drop can be used
102
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Parameters (2) 103
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Parameters (3) 104
function parameters refer to
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Common eligibility parameters (1)
• who_must_be_elig: calculations of the function are carried out if…
o one: one member of the assessment unit is eligible
o one_adult: one adult member of the assessment unit is eligible
o all: all members of the assessment unit are eligible
o all_adults: all adult members of the assessment unit are eligible
o nobody: calculations are carried out for each assessment unit (default)
• By default eligibility is determined by the variable sel_s
(can use other variable in parameter elig_var)
o 0: person is not eligible
o 1: person is eligible
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Common eligibility parameters (2) 106
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Common eligibility parameters (3) who_must_be_elig
idhh
idpers
on
dag
sel_
s
one
one_adult
all
all_adults
nobody
1 11 80 ? ? ? ? ? ?
1 12 60 ? ? ? ? ? ?
1 13 40 ? ? ? ? ? ?
2 21 80 ? ? ? ? ? ?
2 22 6 ? ? ? ? ? ?
3 31 80 ? ? ? ? ? ?
4 41 40 ? ? ? ? ? ?
4 42 40 ? ? ? ? ? ?
107
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who_must_be_elig
idhh
idpers
on
dag
sel_
s
one
one_adult
all
all_adults
nobody
1 11 80 1 ? ? ? ? ?
1 12 60 0 ? ? ? ? ?
1 13 40 0 ? ? ? ? ?
2 21 80 ? ? ? ? ? ?
2 22 6 ? ? ? ? ? ?
3 31 80 ? ? ? ? ? ?
4 41 40 ? ? ? ? ? ?
4 42 40 ? ? ? ? ? ?
Common eligibility parameters (3) 108
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who_must_be_elig
idhh
idpers
on
dag
sel_
s
one
one_adult
all
all_adults
nobody
1 11 80 1 ? ? ? ? ?
1 12 60 0 ? ? ? ? ?
1 13 40 0 ? ? ? ? ?
2 21 80 1 ? ? ? ? ?
2 22 6 0 ? ? ? ? ?
3 31 80 ? ? ? ? ? ?
4 41 40 ? ? ? ? ? ?
4 42 40 ? ? ? ? ? ?
Common eligibility parameters (3) 109
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who_must_be_elig
idhh
idpers
on
dag
sel_
s
one
one_adult
all
all_adults
nobody
1 11 80 1 ? ? ? ? ?
1 12 60 0 ? ? ? ? ?
1 13 40 0 ? ? ? ? ?
2 21 80 1 ? ? ? ? ?
2 22 6 0 ? ? ? ? ?
3 31 80 1 ? ? ? ? ?
4 41 40 ? ? ? ? ? ?
4 42 40 ? ? ? ? ? ?
Common eligibility parameters (3) 110
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who_must_be_elig
idhh
idpers
on
dag
sel_
s
one
one_adult
all
all_adults
nobody
1 11 80 1 ? ? ? ? ?
1 12 60 0 ? ? ? ? ?
1 13 40 0 ? ? ? ? ?
2 21 80 1 ? ? ? ? ?
2 22 6 0 ? ? ? ? ?
3 31 80 1 ? ? ? ? ?
4 41 40 0 ? ? ? ? ?
4 42 40 0 ? ? ? ? ?
Common eligibility parameters (3) 111
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who_must_be_elig
idhh
idpers
on
dag
sel_
s
one
one_adult
all
all_adults
nobody
1 11 80 1 1 ? ? ? ?
1 12 60 0 1 ? ? ? ?
1 13 40 0 1 ? ? ? ?
2 21 80 1 ? ? ? ? ?
2 22 6 0 ? ? ? ? ?
3 31 80 1 ? ? ? ? ?
4 41 40 0 ? ? ? ? ?
4 42 40 0 ? ? ? ? ?
Common eligibility parameters (3) 112
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who_must_be_elig
idhh
idpers
on
dag
sel_
s
one
one_adult
all
all_adults
nobody
1 11 80 1 1 ? ? ? ?
1 12 60 0 1 ? ? ? ?
1 13 40 0 1 ? ? ? ?
2 21 80 1 1 ? ? ? ?
2 22 6 0 1 ? ? ? ?
3 31 80 1 ? ? ? ? ?
4 41 40 0 ? ? ? ? ?
4 42 40 0 ? ? ? ? ?
Common eligibility parameters (3) 113
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who_must_be_elig
idhh
idpers
on
dag
sel_
s
one
one_adult
all
all_adults
nobody
1 11 80 1 1 ? ? ? ?
1 12 60 0 1 ? ? ? ?
1 13 40 0 1 ? ? ? ?
2 21 80 1 1 ? ? ? ?
2 22 6 0 1 ? ? ? ?
3 31 80 1 1 ? ? ? ?
4 41 40 0 ? ? ? ? ?
4 42 40 0 ? ? ? ? ?
Common eligibility parameters (3) 114
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who_must_be_elig
idhh
idpers
on
dag
sel_
s
one
one_adult
all
all_adults
nobody
1 11 80 1 1 ? ? ? ?
1 12 60 0 1 ? ? ? ?
1 13 40 0 1 ? ? ? ?
2 21 80 1 1 ? ? ? ?
2 22 6 0 1 ? ? ? ?
3 31 80 1 1 ? ? ? ?
4 41 40 0 0 ? ? ? ?
4 42 40 0 0 ? ? ? ?
Common eligibility parameters (3) 115
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who_must_be_elig
idhh
idpers
on
dag
sel_
s
one
one_adult
all
all_adults
nobody
1 11 80 1 1 1 ? ? ?
1 12 60 0 1 1 ? ? ?
1 13 40 0 1 1 ? ? ?
2 21 80 1 1 1 ? ? ?
2 22 6 0 1 1 ? ? ?
3 31 80 1 1 1 ? ? ?
4 41 40 0 0 0 ? ? ?
4 42 40 0 0 0 ? ? ?
Common eligibility parameters (3) 116
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who_must_be_elig
idhh
idpers
on
dag
sel_
s
one
one_adult
all
all_adults
nobody
1 11 80 1 1 1 0 ? ?
1 12 60 0 1 1 0 ? ?
1 13 40 0 1 1 0 ? ?
2 21 80 1 1 1 0 ? ?
2 22 6 0 1 1 0 ? ?
3 31 80 1 1 1 1 ? ?
4 41 40 0 0 0 0 ? ?
4 42 40 0 0 0 0 ? ?
Common eligibility parameters (3) 117
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who_must_be_elig
idhh
idpers
on
dag
sel_
s
one
one_adult
all
all_adults
nobody
1 11 80 1 1 1 0 0 ?
1 12 60 0 1 1 0 0 ?
1 13 40 0 1 1 0 0 ?
2 21 80 1 1 1 0 1 ?
2 22 6 0 1 1 0 1 ?
3 31 80 1 1 1 1 1 ?
4 41 40 0 0 0 0 0 ?
4 42 40 0 0 0 0 0 ?
Common eligibility parameters (3) 118
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who_must_be_elig
idhh
idpers
on
dag
sel_
s
one
one_adult
all
all_adults
nobody
1 11 80 1 1 1 0 0 1
1 12 60 0 1 1 0 0 1
1 13 40 0 1 1 0 0 1
2 21 80 1 1 1 0 1 1
2 22 6 0 1 1 0 1 1
3 31 80 1 1 1 1 1 1
4 41 40 0 0 0 0 0 1
4 42 40 0 0 0 0 0 1
Common eligibility parameters (3) 119
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Common output parameters • Output_var, output_add_var
• Either output_var or output_add_var must be indicated!
• Exception: func_Elig sel_s
120
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Common parameter TAX_UNIT • TAX_UNIT defines the assessment unit a function refers to:
o Individual (tu_individual_xx)
o Household (tu_household_xx)
o Various definitions of family units (various names, e.g. tu_family_xx, tu_bu_xx)
• Compulsory for most policy functions!
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Common limiting parameters
• Lowlim (lower limit)
• Uplim (upper limit)
122
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Linking functions
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Interactions between functions (1)
• The functions interact in three ways (+ replacement):
o Condition: one function (usually function Elig) evaluates a condition and a subsequent function operates on the basis of the result of this evaluation
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Interactions between functions (2)
o Input: one function calculates a variable, which is used as an input by a subsequent function.
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Interactions between functions (3) o Addition: one function calculates a part of a policy and a
subsequent function calculates another part of the policy and therefore needs to add to the first part.
126
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Result of a function • It is always assigned to the head of the assessment unit
• For all other members of the unit and for those in not eligible units (defined by who_must_be_elig) :
o output_var is set to zero.
o output_add_var not changed or set to 0 if undefined before
o result_var is set to zero.
127
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Exercise 2
• Reforming Child Benefit in the UK (1)
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Incomelists
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Incomelists
• Aggregates of several variables
• Standardised output (e.g. ils_dispy)
• func_DefIL : special policy (i.e. ILDef_cc) or any other policy
• Once defined it is available for all subsequent functions and policies
• Naming convention: prefix il_ for “normal”, ils_ for “standard”
• No tax unit defined all income lists built at the individual level
• Behave like a monetary variable
130
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Function DefIL (1)
131
• Components:
─Variables
─Pre-defined income lists
─Fixed amounts
─Constants
•Operations:
─+, -
─fractions can be used
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Function DefIL (2)
• If you want to take out a component in a specific policy system replace operation with n/a
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Standardized income lists • Defined in every country • Built in a comparable way to facilitate cross-national analysis
o ils_earns: earnings o ils_origy: market incomes o ils_pen: public pensions o ils_bennt: non-means-tested benefits o ils_benmt: means-tested benefits o ils_ben: all benefits and public pensions o ils_tax: taxes o ils_sicee: employee SICs o ils_sicse: self-employed SICs o ils_sicer: employer SICs o ils_sicct: contributed SICs o ils_sicdy: total SICs o ils_dispy: disposable income o ils_bensim: simulated benefits o ils_taxsim: simulated taxes
133
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Incomelists – Matrix view • Summary of income list components
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Exercise 3
• Reforming Child Benefit in the UK (2)
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End of Day 1
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Nuffield/EUROMOD-UK training course
Day 2
Paola De Agostini and Iva Tasseva ISER, University of Essex
1-2 April 2019
Course based on EUROMOD v. I1.0+
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Outline: Day 2 • Morning (9:00-13.00 with a break at 11:00)
o EUROMOD Functions and Parameters (cont.)
o Hands-on practice
o EUROMOD Functions and Parameters (cont.)
o Hands-on practice
• Afternoon (14.00-17.00 with a break at 15:30)
o Assessment (tax) units in EUROMOD
o Hands-on practice
o Using EUROMOD after the course
o Q&A
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Policy functions BenCalc, SchedCalc, Allocate
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Function BenCalc (1) • Benefit calculator, used to implement a wide range of policy instruments, in
particular benefits
• It combines the functionalities of the functions func_Elig and func_ArithOp
• Calculates a sum of “components”, where the value of a component is only added if a certain condition is fulfilled by at least one member of the assessment unit
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Function BenCalc (2)
• comp_cond = func_Elig |elig_cond
• comp_perTU or comp_perElig = func_ArithOp | formula
o comp_perTU amount is added once
o comp_perElig amount is added once per individual fulfilling the condition is added.
• either perTU OR perElig in one component
• can set upper and lower limits for each component
o comp_lowlim
o comp_uplim
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Function BenCalc (3) • Withdraw parameters: subtract something from the
calculated sum of components o withdraw_base: what is being subtracted (ex: variable, income
list) o withdraw_rate: what percentage of the base is being subtracted o withdraw_start: set a minimum level of the sum of components
before any subtraction begins o withdraw_end: level of the base where sum of the components-
base*rate is 0
• Negative result automatically set to 0 • Result=max(Sum of components-max(BASE-START, 0)*RATE,
0) • _Rate and _end cannot be used simultaneously
o If withdraw_end is specified: RATE=(sum of components)/(END-START)
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Function BenCalc (4) 144
• For more examples see EUROMOD help
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Function BenCalc (5)
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146 146
Function SchedCalc (1) • Used (mainly) for progressive taxes • Tax schedule
o Tax bands: band_upLim / band_lowlim o Tax rate: band_rate o Tax base: base
• Instead of rates, for fixed amounts use band_amount
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Function SchedCalc (2)
• Joint taxation: quotient
• Result= ((Base/Quotient)*Tax schedule)*Quotient
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Function SchedCalc (3)
• simple_prog: apply highest marginal tax rate reached by base on the whole income
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Function Allocate (1)
• Default: result is assigned to the head of the assessment unit
• Split the amount of a variable o share: which variable to split
Amount to split first summed up across assessment unit members
o share_between: condition parameter; who are the members ‘participating’ in the split Default is all members of the assessment unit
o share_prop: in what proportion to split between the various qualifying members (i.e. those satisfying the share_between condition) Default is sharing in equal proportions
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Function Allocate (2)
• Allocate reallocates amounts between members of assessment units (subject to conditions)
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Parameter values
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Amount parameters • Monetary (numbers; use . for decimal) followed by their period:
o #m for monthly (no conversion)
o #y for yearly
o #q for quarterly
o #w for weekly
o #d for daily
o #l for labour day
o #s for six day labour week
o #c for capital (no conversion)
• Default is #m (monthly)
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Query parameters (1) • frequently used ready made calculations
• The results of a query is either yes/no or some (monetary or non monetary) value.
• Well-documented in Help
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Query parameters (2)
• Use IntelliSense to enter values
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query symbol
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Formula parameters • Operations: ^, <min>, <max>, <abs>, (), !(), %, /, *, \, +, -,
• Operands :
o variables (monetary and non monetary),
o Income lists
o queries
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Condition parameters • logical and comparison operations to evaluate a condition with a yes/no result.
• Conditions in by curly brackets {}, can be grouped by parenthesis ()
• Negative condition (i.e. !) can be used with a single condition only
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Footnote parameters • They serve the further specification of other parameters.
They are identified by #i (i=number from 1 to....) o Limits
o Amounts
o Assessment units
o Specification of queries
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Parameter values and Assessment Unit • Assessing the result of a function
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Exercise 4
• Introducing a benefit cap in Denmark
o Use training_data for this exercise
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System functions Uprate, SetDefault, DefOutput,
DefVar
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Function Uprate (I) 161
• Indices to uprate monetary variables to price level of policy year
name of
variable to
be uprated
value of
uprating factor
define factor to be
used later on
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Uprating indices (I)
• Datasets -> used with more than 1 system
o May be needed for various exercises (ex: Policy Effects)
o Fewer datasets than systems
• Discrepancy between the year the dataset refers to and the policy year
• Use uprating indices to index the incomes in the dataset to the policy year (i.e. the year you want to simulate)
o Ex: index the income data referring to 2011 to the 2014 level
• Uprating indices- based on raw series
• EM calculates implicit updating factors
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Uprating indices (II)
163
the index
name the index-
reference
(handle) ($f_)
policy years
source of
information
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Uprating indices (III) 164
• You can see the implicit updating factors applied
• Select the dataset you want to view
• Example:
• Dataset BG_2010_b5 income referring to 2009
• CPI increased between 2009 & 2012 by approx. 9%
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Function Uprate (I)
• Uprating Indices used by the function Uprate
165
Dataset(s) to which the
function applies
Name of income
variable to be
uprated
Reference of
index to be
used for
uprating
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Function Uprate (II) 166
• Aggregate variables • Using different values for different
groups
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Function SetDefault • sets alternative values or variables if a dataset variable is missing
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Function DefOutput • Determines the content of the output file
• TAX_UNIT: level of aggregation
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Function DefVar
• To set intermediate (temporary) variables not included in VarConfig.xml
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Special functions
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Special functions (advanced)
• AddOn_xxx (implement extended functionalities not part of the standard tax-benefit calculations, such as Effective Marginal Tax Rates, different budget sets)
• Loop and UnitLoop (repeat part (or all) of the tax-benefit calculations)
• Store and Restore (set a variable to the initial (or other previous) value
• ChangeParam (modify parameters during the model run)
• Totals (calculates aggregates over groups of persons/households)
• DropUnit and KeepUnit (drops certain persons/households from the calculations)
• ILVarOp (performs operations on variables that are part of an income list)
• RandSeed (generates random numbers)
• CallProgramme (calls another programme, e.g., Stata)
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Exercise 5
• Reforming personal tax allowance for all and calculating devolved income tax for Wales
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Assessment (Tax) Unit
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Assessment Unit • Unit: group of household members to be considered together
• Function DefTU, used at policy TUDef_cc or anywhere
• Defined the first time it is used by the model (see func_UpdateTU)
• Name convention: tu_xxxxxx_cc defined
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Type of assessment units • Parameter type: defines the composition of the tax unit
• HH: all individuals of the household are in the same unit.
• IND: each individual of the household forms its own unit.
• SUBGROUP: individuals determined by parameter members form an unit. The household may be split into several units of different size.
• Micro data used by EUROMOD
o sample of households
o all individuals in a selected household
o if assessment unit includes individuals outside the household cannot be reconstructed exactly
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Individual Household Subgroup
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Some examples of assessment units description idhh idperson idpartner idmother idfather dag Household Individual family
typical family 1 101 102 0 0 30 A A A
1 102 101 0 0 28 A B A
1 103 0 102 101 3 A C A
1 104 0 102 101 1 A D A
couple.without
children
2 201 202 0 0 56 A A A
2 202 201 0 0 55 A B A
lone parent 3 301 0 0 0 35 A A A
3 302 0 301 0 6 A B A
single 4 401 0 0 0 25 A A A
two singles
living together
5 501 0 0 0 22 A A A
5 502 0 0 0 23 A B B
large family 6 601 602 606 0 48 A A A
6 602 601 0 0 45 A B A
6 603 0 602 601 20 A C A
6 604 0 602 601 15 A D A
6 605 0 602 601 10 A E A
6 606 0 0 0 70 A F B
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Head of a tax unit • The head of a tax unit is
o the richest member of the unit (System Configuration: Income for Head Definition)
o the oldest
o the lowest idperson
• ExtHeadCond: further conditions (e.g., female)
parameter name value type
compulsory / optional
default value description
HeadDefInc variable or incomelist
optional ils_origy variable or incomelist used for determining who is the richest person in the assessment unit, see description of parameter ExtHeadCond
ExtHeadCond * condition optional !{IsDepChild} condition further defining the head of the assessment unit the condition is &-linked with the following hardwired head condition: {HeadDefInc>anyother:HeadDefInc} | ({HeadDefInc>=anyother:HeadDefInc} & {dag>anyother:dag}) | ({HeadDefInc>=anyother:HeadDefInc} & {dag>=anyother:dag} & {idperson<anyother:idperson})
StopfIfNoHeadFound yes/no optional no yes: error is issued if ExtHeadCond rules out all household members no: no error issued, ExtHeadCond dropped for affected households
NoChildIfHead yes/no optional no if yes (possible) child status is removed if person is head
NoChildIfPartner yes/no optional no if yes (possible) child status is removed if person is partner
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Members of a tax unit (1) • members usually defines relations with respect to the head of the unit
• possible values
o Partner
o Children (Own/ Loose, dependent...etc)
o Dependent parents
o Dependent relatives
• status of each member (i.e. Partner, OwnDepChild…) is defined by a xxxCond parameter
o PartnerCond
o OwnChildCond
o DepChildCond
o OwnDepChildCond
o LooseDepChildCond
o DepParentCond
o DepRelativeCond
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Members of a tax unit (2) • Condition parameters and default values fully documented in
Help
179
parameter name value type
compulsory / optional
default value description
members categorical compulsory if type= SOUBGROUP
n/a defines which members of the household form a unit if type=SOUBGROUP syntax: status type & status type & status type ... where status type can take the values: - Partner: defined by parameter PartnerCond - OwnDepChild: defined by OwnDepChildCond - LooseDepChild: defined by LooseDepChildCond - OwnChild: defined by OwnChildCond - DepParent: defined by DepParentCond - DepRelative: defined by DepRelativeCond note, that the head is obviously always part of unit and (usually) relations are defined with reference to the head
PartnerCond * condition optional {head:idperson=idpartner} condition defining who is a partner
DepChildCond * condition optional {0} {Default}=!{isparent}&{idpartner<=0}
condition defining who is a dependent child
OwnChildCond * condition optional see ** condition defining who is an own child
OwnDepChildCond * condition optional {isownchild}&{isdepchild} condition defining who is an own dependent child
LooseDepChildCond *
condition optional {idmother=0}&{idfather=0}&{isdepchild} respectively {idparent=0}&{isdepchild}
condition defining who is a loose dependent child
DepParentCond * condition optional see *** condition defining who is a dependent parent
DepRelativeCond * condition optional {0} condition defining who is a dependent relative
LoneParentCond * condition optional {isparentofdepchild}&{idpartner<=0} condition defining who is a lone parent
* variables may be used with the prefixes “head:” or “partner:”.{Default} can be used to further define default condition (see section 14.4) ** OwnChildCond: {head:idperson=idmother}|{head:idperson=idfather}|{partner:idperson=idmother}|{partner:idperson=idfather} respectively: {head:idperson=idparent}|{partner:idperson=idparent}
*** DepParentCond: {head:idmother=idperson}|{head:idfather=idperson}|{partner:idmother=idperson}|{partner:idfather=idperson} respectively: ({head:idparent=idperson}|{partner:idparent=idperson})|({idpartner>0}&({head:idparent=idpartner}|{partner:idparent=idpartner}))
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Members of a tax unit (3) • head: subsequent variable refers to the head of the unit
• partner: subsequent variable refers to the partner of the head of the unit
• {default} default setting, can be combined with further specifications
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Members of a tax unit (4) • DepChildCond: determines who is dependent children
• OwnDepChild: “a son or daughter”. See OwnChildCond
• LooseDepChild: “someone who is depend child but doesn’t cohabit with parent/s”
idperson idpartner idmother idfather dag IsInEducation ils_origy IsDepChild assessment unit
101 102 0 0 44 no 2500 0 A
102 101 0 0 40 no 1200 0 A
103 0 102 101 21 no 1000 0 B
104 0 102 101 19 no 800 0 C
105 0 102 101 17 yes 0 1 A
106 0 102 101 10 yes 0 1 A
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Avoiding to split up families
parameter name value type
compulsory / optional
default value
description
AssignDepChOfDependents yes/no optional no if yes dependent children of dependent unit members (i.e. persons who are not head or partner of the unit) are assigned to the unit child/parent relation is identified by variables idmother, idfather respectively idparent
AssignPartnerOfDependents yes/no optional no if yes partners of dependent unit members (i.e. persons who are not head or partner of the unit) are assigned to the unit partner relation is identified by variable idpartner
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183 183
Using conditions which refer to income
• If the assessment unit is bigger than the individual, the level of interpreting monetary variables or income lists must be considered carefully (using footnotes)
• Queries can be used to define income conditions (e.g. GetParentIncome, GetCoupleIncome, …)
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184 184
Updating assessment units • The tax unit is defined/ calculated the first time it is used by the model:
household members are assigned to respective units once an assessment unit is first used.
• This assignment is not changed with subsequent uses, even if circumstances change.
• However, the reassessment of the units can be enforced by using the function
UpdateTU.
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Tax unit in output file 185
func_DefTu on
Name tu_tinfajt
Type SUBGROUP
Members Partner & OwnDepChild
& DepParent
PartnerCond {Default} & {IsMarried}
DepChildCond {Default} & {dag<25} &
{il_tinty#1<=8000#y}
DepParentCond {Default} & {dag>65} &
{il_tinty#1<=8000#y}
#1_level tu_individual_es
AssignDepChOfDependen
ts yes
AssignPartnerOfDepende
nts yes
LoneParentCond {default} & !{IsMarried} &
{nDepChOfPerson > 0}
idh
h
idp
ers
on
idp
art
ner
idm
oth
er
idfa
ther
da
g
ils_
origy
il_tin
ty
tu_
tin
fajt_he
adid
tu_
tin
fajt_is
pa
rtner
tu_
tin
fajt_is
de
pchild
tu_
tin
fajt_is
de
ppare
nt
tu_
tin
fajt_is
lone
pare
nt
1 101 102 0 0 65 0 0 101 0 0 0 0
1 102 101 0 0 60 0 0 101 1 0 0 0
1 103 0 102 101 30 0 0 103 0 0 0 0
1 104 0 102 101 28 166 147 104 0 0 0 0
2 201 202 0 0 29 1,085 1,007 201 0 0 0 0
2 202 201 0 0 25 953 891 201 1 0 0 0
2 203 0 202 201 3 0 0 201 0 1 0 0
2 204 0 202 201 2 0 0 201 0 1 0 0
52 5,201 5,202 5,206 5,205 40 1,954 1,831 5,201 0 0 0 0
52 5,202 5,201 0 0 38 0 0 5,201 1 0 0 0
52 5,203 0 5,202 5,201 10 0 0 5,201 0 1 0 0
52 5,204 0 5,202 5,201 15 0 0 5,201 0 1 0 0
52 5,205 5,206 0 0 70 0 0 5,201 0 0 1 0
52 5,206 5,205 0 0 70 0 0 5,201 0 0 1 0
92 9,201 0 0 0 80 0 0 9,202 0 0 1 0
92 9,202 0 0 9,201 38 3,740 3,502 9,202 0 0 0 1
92 9,203 0 0 9,201 34 2,483 2,324 9,203 0 0 0 0
92 9,204 0 0 9,202 11 0 0 9,202 0 1 0 0
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Exercise 6
• Reforming the UK child element of Child Tax Credit by:
o narrowing its age condition
o limiting it to two children
• Produce full and partial take-up outputs
186
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Using EUROMOD after the course
187
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Using EUROMOD for UK analysis 1/2
• Access to FRS EUL micro-data
• Simple access and installation procedures; no special IT
requirements
• Standard EUROMOD resources for hands-on users
• EUROMOD help
• Annual Country Reports:
• Which policies are simulated and how
• Information on input data adjustments and updating factors
• Validation of baseline results against official statistics
• https://www.euromod.ac.uk/using-euromod/country-reports/
• EUROMOD software updates
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Using EUROMOD for UK analysis 2/2
• Access to integrated tools which facilitate common types of
analysis including
• A standard set of output table templates
• Policy Effects tool
• Hypothetical Household tool
• EUROMOD “community” resources found online e.g.
• Working papers & Technical notes
https://www.euromod.ac.uk/publications
• Newsletter https://www.euromod.ac.uk/newsletters
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Data Access conditions – other countries
Data access is subject to conditions set by the original data provider • EU-SILC UBD
o Access depends on being in an institution recognised by Eurostat as a “research entity”. For more info see http://ec.europa.eu/eurostat/documents/203647/771732/How_to_apply_for_microdata_access.pdf
o In a second stage you need to be part of a “research proposal” accepted by Eurostat that includes the use of EUROMOD
o When you are ready to submit the second stage proposal contact [email protected]
o Allow at least 4 months for the whole process
• Other data: relatively straightforward procedures
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Responsibilities of EUROMOD hand-on users
• Respect data access rules and conditions
• Acknowledge EUROMOD when it is used
• Submit all papers using EUROMOD for inclusion in the WP series
• Take responsibility for your own use of the model
• Tell us about bugs or errors
• Keep us informed about what you are working on and when you are working actively: that way we can keep you informed of relevant changes
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•Q&A
192
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The Nuffield funded project on EUROMOD-UK
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The Nuffield-funded project’s objectives
• EUROMOD-UK is already available for all to use, and we know that, with personalised support, it can be used in policy debates.
• We want to make this available widely so as to increase the use of tax-ben modelling in policy debates
• The project will:
1. Improve EUROMOD-UK’s relevance for UK policy debates (by adding new functionality)
2. Widen access through e.g. demonstration projects, better documentation, a support group, simpler interface
3. As a case study, show how EUROMOD-UK can be used to design a Basic Income scheme
4. Suggest an agenda for “where next?” that might include web-hosting of the model, and its potential use in education
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What will we actually do? (1/2)
1. Make EUROMOD-UK more relevant for policy work
A. Timeliness • Main release in early autumn, using new FRS and ready for Autumn
Budget, then updated for policy changes shortly after (NB Scotland!)
B. Improvements to model • Review income concepts (e.g. produce AHC)
• Make full use of richness of FRS
• Separate models for 4 nations of UK (and, conceivably, each region) (pooling FRS years, and recognising different policies)
• Produce UK-relevant summary output tables
• Richer options for allowing for non-take-up
• Allow policies to be modelled up to 5 years out (i.e. project population and policies using OBR forecasts and assumptions)
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What will we actually do? (2/2) 2. Widen access A. Training, documentation and support
• Develop training course for non-academic users of EUROMOD-UK • Produce documentation and user guides (based on existing EUROMOD country
report for the UK) • Consider how to get users to help each other
B. Simplified user interfaces (UI) • Consult on and construct a simplified UI • Consult on, and experiment with, building bespoke user interfaces
C. Case study: a basic income scheme in the UK
• Contribute to debate on basic income • Show need for, and potential of, tax-ben models • Create demand amongst BI proponents • a learning device (demonstrating how to make complex & interacting reforms do
what the user intends)
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Key deliverables
1. Four model releases: two main versions, each updated after autumn/winter fiscal events
Oct 2019: FRS 2017/8 with policies to 2020/21. Will include: revised income concepts; UK, Scot and Wales; standard output tables
Oct 2020: FRS 2018/9 with policies to 2021/22 and 2025/26. Will include: as above plus: non-take-up options; NI and England
2. Documentation/user guide/validation documents for all model developments (as required)
3. Simplified interface (2020Q1) and customised interfaces (2021Q1)
4. Workshop on Basic Income, with all options modelled in EUROMOD-UK (2021Q1)
5. Final report, including future agenda (mostly for Nuffield) (2021Q3)