SOUTHMOD – simulating tax and benefit policies for development

In collaboration with the United Nations University World Institute for Development Economics Research (UNU-WIDER) and the EUROMOD team at the Institute for Social and Economic Research (ISER) at the University of Essex, SASPRI is engaged in a programme of work to develop tax-benefit microsimulation models for a number of countries in the Global South. These models, collectively referred to as SOUTHMOD, have been constructed using the EUROMOD platform developed by ISER and the work is being undertaken jointly with local partners in the countries concerned. SASPRI’s contribution to the work programme builds on previous work using the EUROMOD platform to develop similar models for South Africa (SAMOD) and Namibia (NAMOD). 

Initially SASPRI undertook a scoping study to explore the potential of using the EUROMOD platform to develop microsimulation models in the Southern African Development Community (SADC) and the East African Community (EAC). Following on from the scoping study SASPRI has prepared feasibility studies in Mozambique (SADC), Tanzania (EAC and SADC) and Zambia (SADC) with country partners. The feasibility studies have been published as UNU-WIDER working papers and can be downloaded from the SOUTHMOD page on UNU-WIDER’s website. 

More recently SASPRI has been working with country teams in Uganda and Vietnam supporting in the development of UGAMOD and VNMOD respectively.

The following mini-documentary produced by UNU-WIDER demonstrates the value of microsimulation in developing countries and features members of SASPRI:

MOZMOD – Following initial development of the model in 2016, SASPRI has been working with members of the Ministry of Economy and Finance in Mozambique to enhance the model. This has involved preparing a new underpinning dataset and updating the policies. A very successful initial training event for civil servants took place in June 2017. Further training events took place in 2018, 2019 and in August 2020. Training events and activities to disseminate the model are also supported by the International Labour Organization (ILO). The latest version of the model is v2.6 which is available through the UNU-WIDER website. 

TAZMOD – In Tanzania SASPRI is working with colleagues in the Department of Economics at the University of Dar es Salaam. The microsimulation model TAZMOD has been constructed and an initial training event for civil servants took place in September 2017. Further training events have taken place in 2018, 2019 and, most recently, in March 2020. The model has been extensively used and is the basis of three UNU-WIDER working papers on income imputation, VAT, and an older person’s benefit. The working papers should be should be released before the end of 2020. The The latest version of the model is v2.1 which will shortly be available through the UNU-WIDER website. 

UGAMOD In Uganda SASPRI is collaborating with the Ugandan Revenue Authority and Makerere University in the development the microsimulation model UGAMOD. Initial development of the underpinning dataset and model development took place in 2018. Training events as well as further enhancements of the model took place in 2019. The model has been used to investigate the incidence of a range of excise duties and is available here. There will be a further training event towards the end of 2020. The latest version of the model is v1.4 which is available through the UNU-WIDER website. 

MicroZAMOD – In Zambia SASPRI works with colleagues at the Zambia Institute for Policy Analysis and Research (ZIPAR). The microsimulation model MicroZAMOD has been constructed and an initial training event took place in November 2017. During 2018 further refinements to the model were undertaken, the underpinning microdata were updated and a further training event took place. Training events and activities to disseminate the model are also supported by the ILO.

VNMOD – In Viet Nam, SASPRI is collaborating with the Central Institute for Economic Management in the development of VNMOD. The model is available through the UNU-WIDER website.

In addition, SASPRI has produced or co-produced working papers on assessing the quality of income data in datasets underpinning SAMOD; multiple imputation techniques for enhancing the income data in various underpinning datasets of SOUTHMOD microsimulation models; and, on the distributional impact of tax and benefit systems in six African countries.