Application of microsimulation models in the analysis of taxes and social benefits in Croatia (AMMATSBC)
Background
Tax-benefit microsimulation models allow the ex ante review of the effects of changes in a tax-benefit system. They are particularly valuable in policy reform analysis and planning. Unlike in other EU countries, where the use of such models is widespread, their development in Croatia is still in its infancy.
The purpose of this project is to apply microsimulation models of Croatian taxes and benefits in public policy and academic analysis. The project attempts to demonstrate their effectiveness to public administrators and academic researchers in Croatia.
Objectives
The research project has three objectives:
(1) Develop the microsimulation model of Croatian taxes and benefits – miCROmod – a conventional static arithmetic model that simulates social security contributions, personal income tax, guaranteed minimum income, child benefit, parental benefits and unemployment benefit. miCROmod is the core around which several supplemental models will be developed, providing additional functions, and will include (a) a local government supplement, modelling taxes and benefits in the City of Zagreb and (b) a behavioural supplement, simulating the impact of changes of tax-benefit instruments on the labour supply and gross wages.
(2) Employ miCROmod and EUROMOD in the analyses of tax-benefit reform scenarios. miCROmod and EUROMOD (a comprehensive tax-benefit model for the EU) will be used in the analyses of current issues in the Croatian tax-benefit system. These analyses will provide insight into the effect of a number of tax-benefit reforms on income inequality, poverty rates and incentives to work. The following reform scenarios will be simulated: (a) Child benefits reform, (b) Personal income tax reform (c) In-work policies in Croatia, and (d) Local social benefits.
(3) Present the performance of miCROmod and EUROMOD to administrators and researchers.
Team members
Ivica Urban
Researcher - Institute of Public Finance, Zagreb
Slavko Bezeredi
Researcher - Institute of Public Finance, Zagreb
Martina Pezer
Researcher - Institute of Public Finance, Zagreb
Dr Saša Jakšić
Dr Chrysa Leventi
Senior Research Officer - ISER - University of Essex
Professor Holly Sutherland
Research Professor and Director of EUROMOD - ISER - University of Essex
Start date
31 Aug 2015
End date
30 Aug 2018
Funder
Croatian Science Foundation
Data source
- EUROMOD