ETMOD – simulating tax and benefit policies for development in Ethiopia
ETMOD model itself is freely accessible for non-commercial research use but input data has to be manually constructed. Access to the model and the Stata do-files necessary to produce the underpinning data set that corresponds to the model can be requested here.
ETMOD, the tax-benefit microsimulation model for Ethiopia is a highly versatile yet easy to use tool for policymakers and researchers alike.
With ETMOD users can simulate reforms of the tax-and benefit system. They can estimate, for example, the number of beneficiaries and analyse the characteristics of the perspective recipients of a hypothetical benefit. ETMOD also allows users to implement hypothetical income tax and social security reforms and calculate their effects on the government budget.
ETMOD can answer questions such as:
- Are the beneficiaries of a particular policy (reform) more likely to live in urban or rural areas?
- Do they work in the formal sector or not?
- How much would such a policy cost?
- Could specific taxes be increased to offset the additional expenditures on social protection without large reductions in living standards?
Possible policy reform simulations that could be analysed using ETMOD include for example:
- a universal safety net (PSNP for urban households)
- a universal pension for the elderly.
However, the model allows the simulation of multitude of other policy reforms as well.
ETMOD has been developed in cooperation with the Ethiopian Development Research Institute (EDRI), the EUROMOD team at the Institute for Social and Economic Research (ISER) at the University of Essex, and KU Leuven. The current ETMOD national team is based at the University of Insubria in Italy. The latest available version of ETMOD is based on the Ethiopia Socioeconomic Survey (ESS) 2013-14, allowing for representative results on the national and to a certain extent on the sub-national level. Policies are simulated for 2014 through 2017 (based on updated household level data from 2013-14).
ETMOD was launched in Addis Ababa in July 2017 when the first training course also took place with over 30 government officials and researchers from Ethiopia.