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The Hypothetical Household Tool (HHoT) in EUROMOD: a new instrument for comparative research on tax-benefit policies in Europe

Author

Listed:
  • Tine Hufkens

    (European Commission - JRC)

  • Tim Goedeme
  • Katrin Gasior
  • Chrysa Leventi
  • Kostas Manios
  • Olga Rastrigina
  • Pasquale Recchia
  • Holly Sutherland
  • Natascha Van Mechelen
  • Gerlinde Verbist

Abstract

This paper introduces the Hypothetical Household Tool (HHoT), a new extension of EUROMOD, the tax-benefit microsimulation model for the European Union. With HHoT, users can easily create their own hypothetical data, which enables them to better understand how policies work for households with specific characteristics. The tool creates unique possibilities for an enhanced analysis of taxes and social benefits in Europe by integrating results from microsimulations and hypothetical household simulations in a single modelling framework. Furthermore, the flexibility of HHoT facilitates an advanced use of hypothetical household simulations to create new comparative policy indicators in the context of multi-country and longitudinal analyses. In this paper, we highlight the main features of HHoT, its strengths and limitations, and illustrate how it can be used for comparative policy purposes.

Suggested Citation

  • Tine Hufkens & Tim Goedeme & Katrin Gasior & Chrysa Leventi & Kostas Manios & Olga Rastrigina & Pasquale Recchia & Holly Sutherland & Natascha Van Mechelen & Gerlinde Verbist, 2019. "The Hypothetical Household Tool (HHoT) in EUROMOD: a new instrument for comparative research on tax-benefit policies in Europe," JRC Working Papers on Taxation & Structural Reforms 2019-05, Joint Research Centre.
    • Handle: RePEc:ipt:taxref:201905
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    References listed on IDEAS

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    1. H. Xavier Jara & Alberto Tumino, 2013. "Tax-benefit systems, income distribution and work incentives in the European Union," International Journal of Microsimulation, International Microsimulation Association, vol. 1(6), pages 27-62.
    2. Tim Goedemé & Tess Penne & Tine Hufkens & Alexandros Karakitsios & Anikó Bernát & Bori Simonovits & Elena Carillo Alvarez & Eleni Kanavitsa & Irene Cussó Parcerisas & Jordi Riera Romaní & Lauri Mäkine, 2017. "What Does It Mean To Live on the Poverty Threshold? Lessons From Reference Budgets," Working Papers 1707, Herman Deleeck Centre for Social Policy, University of Antwerp.
    3. Herwig Immervoll & Pascal Marianna & Marco Mira d'Ercole, 2004. "Benefit Coverage Rates and Household Typologies: Scope and Limitations of Tax-Benefit Indicators," OECD Social, Employment and Migration Working Papers 20, OECD Publishing.
    4. Natascha Van Mechelen & Sarah Marchal & Tim Goedemé & Ive Marx & Bea Cantillon, 2011. "The CSB-Minimum Income Protection Indicators dataset (CSB-MIPI)," Working Papers 1105, Herman Deleeck Centre for Social Policy, University of Antwerp.
    5. Gasior, Katrin & Recchia, Pasquale, 2018. "The use of hypothetical household data for policy learning – EUROMOD HHoT baseline indicators," EUROMOD Working Papers EM6/18, EUROMOD at the Institute for Social and Economic Research.
    6. Tim Goedemé & Karel Van den Bosch & Lina Salanauskaite & Gerlinde Verbist, 2013. "Testing the Statistical Significance of Microsimulation Results: A Plea," International Journal of Microsimulation, International Microsimulation Association, vol. 6(3), pages 50-77.
    7. Tim Goedemé, 2013. "How much Confidence can we have in EU-SILC? Complex Sample Designs and the Standard Error of the Europe 2020 Poverty Indicators," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 110(1), pages 89-110, January.
    8. Marchal, Sarah & Goedemé, Tim & Siöland, Linus, 2019. "Using HHoT to generate institutional minimum income protection indicators," EUROMOD Working Papers EM4/19, EUROMOD at the Institute for Social and Economic Research.
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    Cited by:

    1. Vincent Vergnat, 2021. "Tax-benefit policies to fight poverty among young adults in Europe," LISER Working Paper Series 2021-09, Luxembourg Institute of Socio-Economic Research (LISER).
    2. Michael Christl & Silvia Poli, 2021. "Trapped in inactivity? Social assistance and labour supply in Austria," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 48(3), pages 661-696, August.
    3. Penne, Tess & Goedemé, Tim, 2021. "Can low-income households afford a healthy diet? Insufficient income as a driver of food insecurity in Europe," Food Policy, Elsevier, vol. 99(C).
    4. Elise Aerts; & Ive Marx; & Gerlinde Verbist;, 2023. "Not That Basic: How Level, Design and Context Matter for the Redistributive Outcomes of Universal Basic Income," Working Papers 2303, Herman Deleeck Centre for Social Policy, University of Antwerp.
    5. Adeline Otto & Alzbeta Bártová & Wim Van Lancker, 2021. "Measuring the Generosity of Parental Leave Policies," Social Inclusion, Cogitatio Press, vol. 9(2), pages 238-249.
    6. Bea Cantillon;, 2022. "The Tragic Decline of the Poverty Reducing Capacity of the Welfare State: Lessons from Two Decades of Social Policy Research," Working Papers 2201, Herman Deleeck Centre for Social Policy, University of Antwerp.
    7. Aerts, Elise & Marx, Ive & Verbist, Gerlinde, 2023. "Not That Basic: How Level, Design and Context Matter for the Redistributive Outcomes of Universal Basic Income," IZA Discussion Papers 15952, Institute of Labor Economics (IZA).

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    Keywords

    HHoT; microsimulation model; hypothetical household simulations; European Union;
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