Business Profile
Last updated: November 2005
Micromacro
Consultants (MMC) is an institute for macro economic and micro
(poverty) model construction, training and research. MMC started
in 1994 and is headquartered in The Hague. Right now it carries out
projects in four different continents. In co-operation with local
counterparts MMC has developed Macroabc models that are in practical
use among others in Indonesia (Ministry of Finance, donor World Bank),
Kenya (donor EU), Ethiopia (Min Finance and Development, donor UNDP),
Curacao (Economic Affairs of the Island), Poland (Min Fin., donor EU).
And in June 2005 a new project started in Aruba.
MMC employs a small staff of full time economists and a group of some
twenty short-term specialists, which have at least fifteen years of
relevant experience. Most of these specialists were (or still are)
employed by the Dutch Central Planning Bureau. In addition to the
international activities MMC carries out research projects in the
Netherlands.
Contents:
International projects
MMC has developed an efficient mix of co‑operation, research and training for technical assistance projects:
- The Subject is the practical training
in macro-economic modeling, data analysis, forecasting, monitoring and
fiscal policy analysis.
- The Vision is to do the work in
co-operation with economists from the country that will use the model
to ensure its sustainability. The sustainability of a model is ensured
if there are sufficient people who know how to update and work with the
model and if this knowledge is passed on to newcomers. MMC pays
particular attention to this phase of model building by organizing
additional training workshops and study-modules. This is one of the
fields where MMC has learned from the experiences of others.
- In most countries macro models already
exist, but are not used in practice. Using MMC’s method the local
counterparts are involved in the (re)building of the macro models right
from the start of the project. Consequently they will understand the
working of the model and generally master it when the model is
finished. After the construction stage MMC gives additional support to
teach the counterparts how to deal with the inaccuracy margins of macro
models forecasts.
- The Approach that is adopted by MMC
was labeled the telework-formula. This approach provides efficient
co-operation between counterparts, European and sometimes also local or
regional consultants, in three ways:
- MMC consultants make short visits to the projects,
- counterparts visit MMC’s office in The Hague, allowing to
involve many specialists within a minimum of working hours, traveling
costs and DSA,
- co-operation by telework in between visits. Telework happens in the
situation where MMC works on a project in The Hague and the
counterparts work on it in their own country. E-mail is used
intensively during these periods to discuss progress and to exchange
results.
- The Methodology used by MMC is
Macroabc, a way of econometric model building that is close to the
financial programming of the IMF and RMSM of the World Bank. Macroabc
models can run in special computer programs as well as in Excel, to
improve accessibility. Micromacrosim is an independent auxiliary that
helps to translate macro economic developments to a micro (poverty)
level.
- The Output of the projects is not only
the model, but more specific the increased knowledge of the
counterparts in macro-economic modeling. MMC carried/carries out successfully technical assistance projects in
very big as well as rather small countries in four continents:
- Aruba, beneficiary: Department of Economic Affairs
- Indonesia, beneficiary: Ministry of Finance, donor: World Bank
- Ethiopia, beneficiary: Ministry of Finance and Economic Development, donor: UNDP
- Kenya, beneficiary: Ministry of Finance, donor: EU
- Curaçao (in the Caribbean), beneficiary& financer: Dep. Economic Affairs Curaçao
- Netherlands Antilles: Baseline study Economic
Development. Ministry Economic Affairs Antilles, financer: Netherlands
- Croatia, beneficiary: Ministry of Finance, donor: USAID
- Macedonia, beneficiary: Ministry of Finance, donor: USAID
- Poland, beneficiary: Ministry of Finance, donor EU
Click on Track record for more information
The development and further innovation of the so called Macroabc
methodology: a prototype macro-economic model for research and training
and the Micromacrosim model for analysis of the link between macro
developments and poverty analysis (from a Macroabc model and micro
income analysis). Actually Macroabc is a collection of ideas, Excel
files, text files and multi media slide shows which are used as a
framework in the country MMC works for. The Macroabc methodology
originally was based on the core equations of the models of the Central
Planning Bureau of the Netherlands. In the following years this
methodology was improved using MMC's experience in the different
countries. A Macroabc version for The Netherlands is available as
shareware. See www.micromacroconsultants.com MMC also developed
Euralyse, a macro model for the economy of the 15 European Union
countries as a whole. In addition to the different Macroabc models MMC
developed Study modules and multimedia self-explaining slide shows on
CDROM.
Activities in the Netherlands
MMC carries out or has carried out projects in The Netherlands for
different ministries (the ministries of Housing, Health, Economic
Affairs, Finance, Internal Affairs, and Education) and the private
sector. For example MMC analyzed the effects of the deregulation of the
housing market, the effects of a reduction in the numbers of hours in
the standard work week, the forecast of the wage drift in the health
sector and in the government sectors, the development of a methodology
to analyze components of wage development, and the construction of a
computer program to calculate the total wage bill and real net income
growth for individuals in the education sector.
The start of MMC
Dr. Marein van Schaaijk, the founder and director of MMC, has 32 years
of experience of working with macro and micro data and models. Of these
32 years he worked 18 years in different research and management
positions within the Central Planning Bureau (CPB) of the Netherlands,
a bureau for economic policy analysis.
The CPB was founded 57 years ago with Dr. J. Tinbergen as its first
director. Because the Netherlands have a free market economy, the CPB
has never been a planning office like those that existed in Middle and
Eastern Europe and in several developing countries. It is a bureau for
economic policy analysis, and its main activities consist of
monitoring, analyzing, forecasting and building scenarios for the Dutch
economy.
Dr. van Schaaijk left the CPB in 1994 and founded MMC because he
foresaw a growing demand for private sector professional research and
training service. There were three factors that strengthened his
beliefs:
- It became more and more accepted that several of the tasks
traditionally performed by the CPB or other government agencies could
be done more efficient by private companies.
- The CPB of the Netherlands decided to concentrate on core activities, leaving macro modeling consultancy to others
- Thanks to the Labor Shortening Time CPB employees got 25
workings days a year additionally available for private short term
consultancy, as long as this is not conflicting with their regular job.
MMC's successful activities in the eight years of its operation until
now show that there exists a sizeable demand for the services offered
by MMC. MMC has a very flexible organizational set‑up. It has a small
fixed staff (two or three full time economists, one part time secretary
and one part time director for human resources and marketing with a
Masters in Management) augmented by a large network of specialized
short term experts with academic, government service and other
professional backgrounds.
MMC’s policy
The main goal of MMC’s international activities is to make its
counterparts self-sufficient in the constructing, maintenance and
understanding of macro-economic and fiscal modeling and micro(poverty)
analysis. The strength of MMC’s international activities is the
application of the lessons that were learned from the experiences of
others.
For many years the approach of foreign consultants was to send a senior
economist to the counterpart country for a period of several years. MMC
assessed this approach and identified multiple drawbacks. It is
expensive; a senior economist has to be paid full-time for several
years. Another disadvantage is the fact that the specialist tends to do
all the work. This is because the consultant is present at all times
and therefore has enough time to finish the project by himself. This
means there is little interaction during the construction phase;
consequently the counterparts never really master the model. This
implies that the model is doomed to fade away as the specialist leaves
because the counterparts do not master the model and also are not able
to adapt the model to a changing economic environment if necessary. If
the working of the model is not completely understood by its users the
model looses a lot of its relevance. This is because macro-economic
model are only an auxiliary and need to be supplemented by economic
analysis and reasoning. This approach is costs oriented, while
MMC’s approach is output oriented.
The telework-formula is MMC’s answer to these disadvantages. In
the telework-formula there are three types of activities; MMC
consultants work together with counterparts in the foreign country; a
small group of counterparts visits The Hague to benefit from the large
pool of experts available to MMC in The Netherlands; the third type is
the telework: MMC works in The Hague and the counterparts work in their
own country, e-mail is used to discuss problems, ideas and progress.
There are several advantages to this formula.
- It is cheap because MMC’s consultants do not have
to be employed full-time. The time they spent in the counterpart
country is limited.
- During their visit to the Netherlands the counterparts
have access to the expertise of many specialists in different areas.
- Because the counterparts are involved in the project
from beginning to end and have to do a lot of the work themselves they
are thoroughly trained in the construction, maintenance and theory of
macro models.
- The output is clear, a running model plus the increased macro-economic knowledge of the counterparts.
Pool of short-term experts
MMC uses a project approach in its organization. For each project, MMC
organizes a flexible team from a pool of short-term experts. These
short-term experts form the center of MMC. So far, MMC has employed
already 23 different very experienced specialists in this way.
Furthermore, also other specialists are willing to commit themselves
for periods from a few days up to seven weeks a year, and some even for
several months a year. All of these short-term advisers have at least
fifteen years of experience and most of them work for or have worked
for the Central Planning Bureau of the Netherlands. They are able to
combine their regular jobs with consulting work for MMC because, in
addition to a regular four week vacation, Dutch civil servants have
another four or five weeks a year off because of 'reduced labor hours',
and they are free to take on consulting jobs during that time. Next to
the use of senior economists as consultants MMC sometimes hires junior
economists on a flexible basis.
Co-ordinates
Micromacro Consultants Ltd. (MMC) is an institute for macro economic
and micro (poverty) model construction, training and research. It
is a privately held company headquartered in The Hague. It is a
privately held company registered at the The Hague Chamber of Commerce
(No. 27150586), in ADB DACON no. 001724 and in the Central Consultancy
Registry DG1A EU (No.NED22367). It was founded in November 1994.
Directors: Dr. Marein van Schaaijk and Conny van Schaaijk-van der
Schilden MM.
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