WP 26-01.

This paper compares the distributional incidence of three decarbonization instruments in the Belgian residential sector: EPC-based minimum standards, carbon pricing with an equal per-household dividend, and renovation subsidies financed by a uniform lump-sum tax. Using Woonsurvey 2018 and a dwelling-level microsimulation model that evaluates renovation profitability on observed energy use, we quantify household monetary impacts, renovation take-up, and equity (across and within income groups) for budget neutral policies calibrated to common CO2 targets. Three results stand out. First, EPC standards concen- trate burdens on low-income and low-use households and generate high dispersion because they compel renovations where realized savings are small. Second, universal subsidies are costly on average and distribute benefits unevenly, with sizable transfers to infra-marginal projects. Third, carbon pricing with revenue recycling yields the lowest and most evenly distributed household burdens, largely because it triggers heat-pump adoption in dwellings with the highest energy consumption. We further show that combining a modest carbon price with targeted heat-pump support can meet the same emissions target at lower cost and with a smaller variance of household impacts than under the carbon dividend. Results are robust to rebound, landlord–tenant limits, and reasonable variations in discounting, horizons, and costs.

Field :

WP 25-02.

This paper investigates the behavioral and welfare impacts of carbon pricing on energy- vulnerable households in Belgium. We focus on two distinct groups: energy poor (EP) households, who spend a large share of their income on energy, and hidden energy poor (hEP) households, who spend very little on energy, suggesting severe self-restriction. Leveraging eleven cross-sections of the Belgian Household Budget Survey, we estimate a Quadratic Almost Ideal Demand System with demographic controls to simulate household responses to energy price changes under the forthcoming EU ETS 2 reform. Our analysis shows that hEP households - despite their low observable energy use - suffer disproportionately high welfare losses. In contrast, EP households face higher tax burdens but experience comparatively smaller welfare impacts. Both groups display greater price sensitivity - particularly for heating fuels and transport - than the general population, with income emerging as the primary driver of this responsiveness. Logistic regression results further highlight key structural differences between EP and hEP households in terms of housing characteristics, heating systems, and regional location. These findings underscore the importance of integrating different vulnerability profiles into carbon pricing assessments, enabling the identification of horizontal equity concerns that are often overlooked in income-based analyses.

Field :

WP 25-01.

Field :

WP 24-01.

I compute and investigate wage differentials in Belgium between individuals born in the country and five major groups of non-native workers. I find that foreigners -but those from EU15 countries- earn, on average, less than natives, with the size of the wage gap that varies importantly across the different groups. Applying the Oaxaca-Blinder decomposition to the wage differentials, I find that skills and characteristics only account for a portion of the gaps. Complementarily, a part of the wage differentials remains persistently unexplained, especially for non-European workers. Additional information on industry affiliation and occupation decreases this unexplained part, but it also shows the existence of industrial and especially occupational segregation. Detailed heterogeneity analysis reveals also a prominent role of the time spent in the country in decreasing wage gaps and evidence of glass ceilings rather than sticky floors. The examination of immigrant wage differentials throughout the study period indicates that the average relative wage of all immigrants - except those from non-EU European countries- decreased.

Field : labor economics

WP 23-03.

Field : labor economics

WP 23-02.

Field : labor economics

WP 23-01.

Field : labor economics

WP 22-02.

Field : statistics synthetic data generation

WP 22-01.

Field : statistics synthetic data generation

WP 21-01.

Road traffic is necessary for a successful functioning of market economy and its volume is positively correlated with economic development. However, its rapid increase fostered by economic growth is problematic as road traffic results in numerous externalities. The externalities resulting from traffic are costs that are created but not born by motorists that create them. Among these are such ‘classic’ externalities as congestion, air pollution and noise, traffic accidents, carbon emissions, etc. However, the recent evidence suggests that apart from these typical traffic externalities there may be many more non-obvious ones, e.g. longer emergency response times and resulting higher average monetary damages from fires (Brent and Beland, 2020). Traffic externalities can be internal to transportation system meaning that they affect motorists only, such as congestion, car crashes, wear and tear of road infrastructure, etc. But many externalities are external to transportation system and affect non-users, such as air and noise pollution, carbon emissions etc. Therefore, it is crucial to find the best tools to deal with the road transport externalities.

Field : transport economics

WP 20-02.

Belgium has implemented, following the example of other coun- tries, in-work benefit policies since the early 2000’s, with the objective of mak- ing work pay and doing so, get more people at work. Belgian in-work benefits differ from most other in-work benefits as eligibility requires low hourly earn- ings. Their generosity tends to increase over time. We study the effects further extensions of those benefits would have both on labour supply and welfare, us- ing a random-utility - random-opportunity model estimated on cross-sectional SILC datasets. Results show that further increasing the benefits will mostly slightly increase labour supply and welfare of low-to-middle welfare deciles, but at very high net cost per job created. We compare our results with existing re- search and explain some mechanisms that possibly lead to an underestimation of negative intensive margin labour supply responses in previous simulations.

Field : labor economics policy evaluation

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In most European countries, poor cohabiting adults are eligible to lower per capita social assistance benefits than poor adults living alone, as they are supposed to benefit from economies of scale in household expenses as housing, heating costs, etc. In this paper, we show that this aspect of social assistance varies strongly within Europe and use this variation to identify a possible causality of social assistance scheme parameters on cohabitation decisions. Our statistical analysis suggests that high benefits for cohabitants decrease the number of poor one-person households significantly. We discuss the consequences of this result on government expenditures and touch upon externalities that strengthen the case for higher cohabitant amounts in countries with strongly differentiated rates.

Field : fomily economics policy evaluation

WP 18-02.

We analyze experimentally behavior in a finitely repeated public goods game. One of the main results of the literature is that contributions are initially high, and gradually decrease over time. Two explanations of this pattern have been developed - (i) The population is composed of free-riders, who never contribute, and conditional cooperators, who contribute if others do so as well (preference-based explanation), and (ii) strategic players contribute to sustain mutually beneficial future cooperation, but reduce their contributions as the end of the game approaches. This paper contributes to bridging the gap between these views. We analyze preferences and strategic ability in one design by manipulating group composition to form homogeneous groups on both dimensions. Our results highlight the interaction between the two: groups that sustain high levels of cooperation are composed of members who share a common inclination toward cooperation and have the strategic abilities to recognize and reap the benefits of enduring cooperation.

Field : game theory

WP 18-01.

From a survival analysis perspective, bank failure data are often characterized by small default rates and heavy censoring. This empirical evidence can be explained by the existence of a subpopulation of banks likely immune from bankruptcy. In this regard, we use a mixture cure model to separate the factors with an influence on the susceptibility to default from the ones affecting the survival time of susceptible banks. In this paper, we extend a semi-parametric proportional hazards cure model to time-varying covariates and we propose a variable selection technique based on its penalized likelihood. By means of a simulation study, we show how this technique performs reasonably well. Finally, we illustrate an application to commercial bank failures in the United States over the period 2006-2016.

Field : statistics synthetic data generation