ECUAMOD - simulating tax and benefit policies for development in Ecuador
ECUAMOD model is freely accessible for non-commercial research use. You may request access to the model here.
ECUAMOD, the tax-benefit microsimulation model for Ecuador, is a highly versatile yet easy to use tool for policymakers and researchers alike. It allows the user to analyse and compare the effects of different tax-benefit policy scenarios on poverty, inequality, and government revenues. The model applies user-defined tax and benefit policy rules to micro-data on individuals and households and calculates the effects of these rules on household income.
With ECUAMOD users can simulate hypothetical reforms of the tax-and-benefit system. They can estimate, for example, the number of beneficiaries and analyse the characteristics of the prospective recipients of a hypothetical benefit. ECUAMOD also allows users to implement hypothetical income tax and social security reforms and calculate their effects on the government budget.
ECUAMOD can answer questions such as:
- Which type of prospective reforms could improve living standards of rural and informal workers?
- How much would such policies cost?
- What type of reforms to direct and indirect taxes would be needed to offset the additional expenditures on social protection?
Possible policy reform simulations in ECUAMOD include for example:
- changes to the Human Development Transfer (Bono de Desarrollo Humano)
- a universal basic income
- abolishing deductions from personal expenditures from personal income tax
However, the model allows the simulation of multitude of other policy reforms as well.
ECUAMOD has been developed in cooperation with the Instituto de Altos Estudios Nacionales (IAEN), and the EUROMOD team at the Institute for Social and Economic Research (ISER) at the University of Essex. The current ECUAMOD country partner is Facultad Latinoamericana de Ciencias Sociales Sede Ecuador (FLACSO). The latest available version of ECUAMOD is based on the National Income and Expenditure Survey in Rural and Urban households (Encuesta Nacional de Ingresos y Gastos de Hogares Urbanos y Rurales, ENIGHUR) 2011/12 allowing for representative results on the national and sub-national level. Policies are simulated for 2011 through 2019 (based on updated household-level data from 2011/2012).
After ECUAMOD was launched in 2016, three training courses have taken place in Quito, Ecuador with government officials and researchers including representatives from the Central Bank of Ecuador and the Ministries of Economic Policy and Finance of Ecuador. In 2018, a conference on income redistribution and the role of tax-benefit systems in Latin America was organized with the aim to provide a space for discussion between academics and policymakers from Ecuador and other Latin American countries. On this base the close liaison and exchange with co-ordinators of LATINMOD, the first set of harmonized cross-country models for Latin America, will continue to foster the learning between neighbouring countries.