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ESCB Network on Microsimulation Modelling

The ESCB Network on Microsimulation Modelling was established to enhance the microsimulation capacity within the European System of Central Banks (ESCB). The network aims to foster cross-country collaboration on research projects and policy analyses, offering peer support and strengthening technical expertise in microsimulation modelling.

Objectives

The main objective of the ESCB Network on Microsimulation modelling is to conduct joint policy analysis and research using microsimulation models. By leveraging these models, the network can provide detailed insights into the distributional effects of various economic policies, such as tax reforms, social security changes and monetary policy adjustments. This collaborative approach allows for a better understanding of how such policies affect different population groups, thereby informing fairer and more effective policy decisions.

The network also aims to strengthen the technical expertise on microsimulation modelling within the ESCB by sharing knowledge and skills through workshops, training sessions and collaborative projects. These activities help to spread best practices and innovative methods among member institutions, ensuring that all participants can benefit from the latest advances in microsimulation techniques. By building a community of practice, the network improves the overall analytical skills across the ESCB, enabling more robust and sophisticated policy analyses.

Within the network, staff of the ECB and national central banks (NCBs) collaborate with the European Commission’s Joint Research Centre as well as centres of excellence in universities and research institutes.

Research priorities

Simulate

The ESCB Network on Microsimulation Modelling prioritises research that focuses on the simulations relevant to central banking, including those for assessing the welfare and distributional impact of monetary policy.

Analyse

The network also analyses distributional and price effects of government policies, such as direct and indirect taxes as well as government subsidies and welfare expenditure.

Explore

Additionally, the network aims to explore the relationship between tax rates and government tax revenue.

Understand

It also prioritises integrating behavioural dimensions and dynamics into microsimulation modelling to better understand the responses of households and firms to economic shocks and policy changes.

Ongoing projects

  • High inflation and policy responses
  • Corporate tax microsimulation model
  • EU Emissions Trading System (EU ETS)
  • Indirect taxes
  • Tax elasticities

Completed projects

Fiscal drag in theory and practice

Chairs and coordinators

Chairs
  • Maximilian Freier, ECB
  • Sara Riscado, Banco de Portugal, currently OECD
Coordinators
  • Maria Flevotomou, Bank of Greece - Coordinator of the workstream on inflation and the policy responses
  • Esteban García Miralles, Banco de España - Coordinator of the workstream on fiscal drag in theory and practice
Central banks involved
  • Nationale Bank van België/Banque Nationale de Belgique
  • Deutsche Bundesbank
  • Eesti Pank
  • Central Bank of Ireland
  • Bank of Greece
  • Banco de España
  • Banque de France
  • Banca d'Italia
  • Central Bank of Cyprus
  • Latvijas Banka
  • Lietuvos bankas
  • Banque centrale du Luxembourg
  • Magyar Nemzeti Bank
  • Bank Ċentrali ta' Malta/Central Bank of Malta
  • De Nederlandsche Bank
  • Oesterreichische Nationalbank
  • Banco de Portugal
  • Banka Slovenije
  • Národná banka Slovenska
Associated institutions
  • European Commission’s Joint Research Centre
  • Ifo Institute for Economic Research

Publications

Amores et al. (2024), “Inflation, Fiscal Policy, and Inequality: The Impact of the Post‐Pandemic Price Surge and Fiscal Measures on European Households”, Review of Income and Wealth, Vol. 71, No 1

Conferences and workshops

Contact information

For further information, just send us an email.