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The Institution

The Federal Planning Bureau (FPB) is an independent public agency. It draws up studies and projections on economic, social and environmental policy issues and on the integration of these policies within a context of sustainable development.

Michel Dumont

After graduating as commercial engineer, Michel Dumont completed a PhD in applied economics at the University of Antwerp in 2004. Between 2004 and 2007, he taught international economics and international economic organisations at the University of Antwerp. In 2007 he was also professor of economics of innovation at Delft University of Technology.

He has been working as an analyst in the structural studies team since 2007. He has carried out research on the structural determinants of economic growth and productivity, focusing on the importance of research and development (R&D) as well as human capital for innovation. In particular, he looks at the effectiveness of the tax advantages granted by the Belgian federal authorities to companies engaged in R&D. He also analyses the dynamics of the economic activity branches using data on the entry and exit of firms in a field and the growth of (start up) companies.




  • Structural studies

CV & Publicaties

  • Public Support to Business Research and Development in Belgium - Fourth evaluation

    Whereas regional subsidies and some tax incentives appear to encourage firms to increase their investment in R&D activities, some incentives provided through corporate income taxation seem to have no additionality effect or even result in the crowding out of firms’ own R&D expenditures. As these incentives claim the lion’s share of the rapidly rising budgetary cost of public support to business R&D, the efficiency of tax incentives for R&D activities could be increased by introducing a cap on the total amount of public support that companies can receive, as also suggested by an international study.

    REP_12721 [22/11/2022]
  • New evaluation of public support to research and development in Belgium

    A new evaluation of public support to R&D in Belgium shows that regional subsidies and the federal partial exemption from payment of the withholding tax for researchers may have helped to increase R&D expenditure in Belgium. The results are less positive for some benefits granted by the federal government through corporate income taxation. As these tax benefits account for the lion's share of the rapidly increasing budgetary costs of public support for R&D, the efficiency of public support could be increased.

    Article 014 [22/11/2022]
  • Business dynamism and productivity growth in Belgium

    This paper considers the evolution in business dynamism and its potential link with productivity growth in Belgium. Statistics on business creation, the exit of enterprises and within-industry reallocation are presented. Data on Belgian firms, covering the period 2003-2017, are used for a decomposition of productivity growth. The paper provides robust indications of the substantial contribution of productivity growth of start-ups in the early years after entry.

    Working Paper 05-21 [28/05/2021]
  • The most important R&D industries in Belgium – Structural evolutions and firm strategy

    Has the production process of the industries that do the most R&D in Belgium changed over the last 10 years? This analysis attempts to answer this question using both sectoral and company data.

    Working Paper 07-20 [22/12/2020]
  • L’impact de la COVID-19 sur la création de nouvelles entreprises en Belgique
    De impact van COVID-19 op de oprichting van nieuwe ondernemingen in België

    Les données relatives à la création de nouvelles entreprises ne donnent qu’une image partielle de l’impact économique de la COVID-19. Ces données étant publiées tous les mois, elles permettent néanmoins d’estimer cet impact plus rapidement que les données sur la situation financière des entreprises existantes, qui ne sont disponibles qu’une fois par an et avec un certain retard. Vu le rôle important des nouvelles entreprises pour l’innovation et le dynamisme des branches d’activité, les chiffres sur les créations de nouvelles entreprises peuvent également donner une indication des séquelles économiques durables laissées par la crise sanitaire actuelle et des glissements éventuels d’activité.

    Gegevens over de oprichting van nieuwe ondernemingen zeggen niet alles over de economische impact van COVID-19. Door hun maandelijkse beschikbaarheid maken ze het wel mogelijk om de gevolgen sneller in te schatten dan mogelijk is met gegevens over de financiële toestand van bestaande ondernemingen, die enkel jaarlijks en met meer vertraging verschijnen. Gezien de belangrijke rol van jonge bedrijven voor innovatie en de dynamiek van bedrijfstakken kunnen cijfers over het aantal opgerichte ondernemingen ook een aanwijzing geven van blijvende economische littekens van de huidige gezondheidscrisis en van mogelijke verschuivingen van bedrijfsactiviteiten.

    Article 004 [09/09/2020]
  • Tax incentives for business R&D in Belgium - Third evaluation

    Belgium has committed to raise investment in research and development (R&D) to 3% of GDP by 2020. In fulfilment of this commitment, the federal government introduced different tax incentives in support of business R&D. This paper presents the results of the third evaluation of the efficiency of these tax incentives, covering the period 2003-2015.

    Working Paper 04-19 [29/04/2019]
  • Description du modèle QUEST III R&D
    Beschrijving van het QUEST III R&D-model

    Le modèle d’équilibre général dynamique stochastique QUEST III R&D sera utilisé pour simuler les effets à long terme des mesures structurelles de chaque parti politique dans le cadre du ‘chiffrage des programmes électoraux 2019’. Le présent document résume les caractéristiques du modèle, en présente la structure et les principaux mécanismes de transmission ainsi que les limites. Le fonctionnement du modèle est ensuite illustré à l’aide de quatre réformes structurelles stylisées.

    In het kader van de ‘doorrekening van de verkiezingsprogramma’s 2019' zal het dynamisch stochastisch algemeen-evenwichtsmodel QUEST III R&D gebruikt worden om de effecten op lange termijn te simuleren van structurele maatregelen die door de politieke partijen worden voorgesteld. Dit document geeft een samenvatting van de kenmerken van het model, presenteert de structuur ervan en de belangrijkste transmissiemechanismen en beperkingen. Vervolgens wordt de werking van het model geïllustreerd aan de hand van vier gestileerde structurele hervormingen.

    DC2019_WP_02 [21/12/2018]
  • Young Firms and Industry Dynamics in Belgium

    Recent studies reveal the importance of entrants and young firms for job creation, productivity and economic growth. Some scholars argue that the falling rate at which new firms are established, can explain, to a certain extent, the productivity slowdown witnessed in most OECD countries. Belgium appears to stand out unfavourably from other countries in its very low start-up rate. This paper reviews the empirical cross-country evidence, provides some additional analysis of the role of young firms in industry-level employment and productivity dynamics in Belgium and concludes with a discussion of the implications for economic policy.

    Working Paper 06-16 [24/06/2016]
  • Evaluation of federal tax incentives for private R&D in Belgium: An update

    This paper presents the results of a second evaluation of the tax incentives that were introduced – between 2005 and 2008 – by the Belgian federal government to support R&D activities of private companies. Compared with the first assessment, carried out in 2012, this evaluation extends the period considered by two years (2010 and 2011) and provides the results of a first assessment of the tax credit for investment in R&D and the tax deduction of 80% of qualifying gross patent income that were introduced in 2007. The second evaluation also elaborates on the difficulties of estimation procedures to establish the "causal" effect of public support and the importance to account for the strong persistence in firm-level R&D expenditures.

    Working Paper 05-15 [25/06/2015]
  • Public support for R&D and the educational mix of R&D employees

    In this paper we assess the impact of public support for R&D activities on the educational mix of R&D employees in private companies in Belgium, covering the period 2001-2009. Data on federal tax incentives in support of R&D activities are matched with R&D survey data to investigate changes in the share of R&D employees with a specific degree: PhDs; higher education (second stage and first stage respectively); and other qualifications. Estimations show that public support significantly
    raises the share of researchers holding a PhD. There are indications that PhDs substitute for R&D employees with a lower degree. We also show that controlling for the changes in the educational mix of R&D personnel lowers the estimates of the impact of public support on the average wages of researchers.

    Working Paper 08-14 [30/10/2014]
  • Machines that go ‘ping’: medical technology and health expenditures in OECD countries

    While rising health care expenditures as a percentage of national income is a well-known and widely documented feature across the industrialized world, it has proved difficult to quantify the effects of the underlying cost drivers. The main difficulty is to find suitable proxies to measure medical technological innovation, which is believed to be a major determinant of steadily increasing health spending. This paper’s main contribution is the use of data on approved medical devices and drugs to proxy for medical technological progress. The effects of these variables on total real per capita health spending are estimated using a panel model for 18 OECD countries covering the period 1981-2009. The results confirm the substantial cost-increasing effect of medical technology, which may account for at least 50% of the explained historical growth of spending. Excluding the approval variables causes a significant upward bias of the estimated income elasticity of health spending and negatively affects some model specification tests. Despite the overall net positive effect of technology, the effect of two subgroups of approvals on expenditure is significantly negative. These subgroups can be thought of as representing ‘incremental medical innovation’, while the positive effects are related to radically innovative pharmaceutical products and devices. The results are consistent with those reported in other studies which suggest that some new products, despite their high price when they are introduced, can ultimately save money by reducing spending on other medical interventions.

    Working Paper 02-13 [29/01/2013]
  • The impact of subsidies and fiscal incentives on corporate R&D expenditures in Belgium (2001-2009)

    This paper presents the results of an initial evaluation of federal fiscal incentives in support of Research and Development (R&D) by companies in Belgium. The impact of regional subsidies and the partial exemption from advance payment for R&D personnel is estimated for the period 2001-2009. The results show that the existing measures of public support have stimulated companies to carry out additional R&D activities.

    Working Paper 01-13 [25/01/2013]
  • Fragilité de la structure financière des entreprises non financières du secteur marchand en Belgique en 2007 et 2010
    Fragiliteit van de financiële structuur van de niet-financiële ondernemingen in de marktsector in België in 2007 en 2010

    Alors que 2007 était encore une année faste pour les entreprises en Belgique, avec la création d'un nombre important de sociétés et une hausse de l'emploi, l’année 2008 voit l’éclatement de la crise financière mondiale entraînant avec elle une récession économique en 2009. Sur la base des comptes annuels publiés, la présente étude compare la situation financière des sociétés belges en 2007, c'est-à-dire une année avant la crise financière, avec celle de 2010, dernière année disponible qui se caractérise par un léger redressement de l'activité économique. Par ailleurs, la possibilité que de faibles résultats financiers en 2007 puissent expliquer, au moins en partie, les difficultés rencontrées par les entreprises sur la période 2008-2010 (comme les faillites) est envisagée.

    Daar waar 2007 in België nog een topjaar was met veel startende ondernemingen en een stijgende werkgelegenheid, brak eind 2008 de wereldwijde financiële crisis uit die leidde tot een economische recessie in 2009. In deze studie wordt, op basis van informatie uit gepubliceerde jaarrekeningen, de financiële situatie van Belgische niet-financiële ondernemingen in 2007, het jaar vóór de financiële crisis, vergeleken met de situatie in 2010, het meest recente jaar waarvoor gegevens beschikbaar zijn en tevens een jaar waarin er een licht herstel werd vastgesteld. Er werd ook nagegaan of een zwakke score voor een aantal financiële ratio’s in 2007, voor een deel kan verklaren waarom sommige ondernemingen in de periode 2008-2010 in de problemen kwamen (bijvoorbeeld een faillissement).

    Press 20120802 [02/08/2012]
  • Fragiliteit van de financiële structuur van de niet-financiële ondernemingen in de marktsector in België in 2007 en 2010

    The working paper compares the financial structure of non-financial companies by branch between 2007 and 2010. In particular, the analysis focuses on the financial fragility of branches. It also tries to determine whether the problems faced by entreprises during the 2008-2010 period can partly be explained by the financial structure of those entreprises in 2007. 

    Working Paper 10-12 [02/08/2012]
  • Impact des subventions et des incitations fiscales sur la recherche et le développement des entreprises en Belgique (2001-2009)
    De impact van subsidies en fiscale voordelen op onderzoek en ontwikkeling van ondernemingen in België (2001-2009)

    Ce papier décrit les résultats d’une première évaluation des incitations fiscales en vue de stimuler les activités de recherche et développement (R&D) dans les entreprises en Belgique. Dans un premier temps, elle rappelle les arguments en faveur de l’aide publique à la R&D et présente une étude des méthodes d’estimation des effets des mesures de soutien. Ensuite, elle présente les résultats d’estimations réalisées à partir de données sur les subventions régionales et les aides fiscales à la R&D octroyées en Belgique au cours de la période 2001‐2009.

    Deze Working Paper beschrijft de resultaten van een eerste evaluatie van de fiscale voordelen om onderzoek en ontwikkeling (O&O) door ondernemingen in België te bevorderen. Na een bespreking van de argumenten voor overheidssteun voor O&O, wordt een overzicht gegeven van de methodes die gebruikt kunnen worden om de impact van overheidssteun te schatten. Daarna worden de resultaten besproken van schattingen die werden gedaan op basis van gegevens over gewestelijke subsidies en federale fiscale steun voor O&O voor de periode 2001‐2009.

    Working Paper 08-12 [18/06/2012]
  • A decomposition of industry-level productivity growth in Belgium using firm-level data

    In this Working Paper the growth in industry-level total factor productivity, i.e. the part of output growth that cannot be accounted for by growth in the production factors, is decomposed using Belgian firm-level data for the period 2000-2008. Decomposition permits to assess to what extent productivity growth in a given industry results from changes in firm-level productivity, from reallocation of market shares between existing firms or from firm entry and exit.

    Working Paper 11-11 [21/07/2011]
  • The determinants of industry-level total factor productivity in Belgium

    In this Working Paper the impact of potential determinants of total factor productivity, i.e. the part of output that cannot be explained by the quantity of production factors, is estimated for Belgium using industry-level data for the period 1988-2007.

    Working Paper 07-11 [26/04/2011]
  • Lissabon 10 jaar later: de evolutie van de uitgaven voor onderzoek en ontwikkeling in België vergeleken met andere EU-landen

    In this working paper the evolution of expenditures for research and development (R&D) in Belgium, in the period 1995-2007, is compared to the evolution in ten other EU countries. R&D expenditures by companies established in Belgium evolved quite favourably up to 2001 but subsequently not only did R&D intensity in Belgium decrease but the position relative to other countries deteriorated as well. This evolution seems to be due mainly to a decline in the share of a significant number of industries in Belgium in the overall R&D expenditures of the group of countries considered, and less the result of the type of industries in which Belgian companies have specialized.

    Working Paper 20-10 [29/10/2010]
  • Wages and employment by level of education and occupation in Belgium

    Increased international economic integration and skill-biased technological change are often regarded as the main drivers of the rising inequality in wages and employment witnessed in industrialized countries in recent decades as they are believed to emphasize differences between individuals in level of education. However, proponents of a task-based view of technological change and offshoring stress the evolving content of tasks as the major determinant of shifts in labour demand and argue that this does not necessarily imply a clear-cut match between the level of education and job opportunities. Belgian data from the Structure and Distribution of Earnings Survey for the period 1999-2004 suggest that the level of wages is significantly correlated with the level of education but wage growth is not. Occupation seems to explain a statistically significant part of the wage level as well as wage growth of workers. The analysis supports the view that the level of education provides less information than the occupation of workers in explaining changes in wages and employment. Overall, it appears that a policy that simply aims to increase the level of education of the active population is not warranted. In addition to the risk of over-education, such a policy is not likely to alleviate the mismatch which to some extent exists between the competencies required by employers and the competencies offered by workers and the unemployed.

    Working Paper 22-08 [17/12/2008]
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