RIEB Discussion Paper Series No.2014-21
Welfare Benefits of Capital Controls:The Case of Spain
We estimate a small open economy RBC model augmented with a simple
form of financial frictions using Spanish data and Bayesian methods.
The estimated model matches well with key Spanish business cycle
statistics. Using the estimated model, we find that significant
welfare benefits may accrue from capital controls.
Capital controls, Welfare, DSGE, Small open economy models, Bayesian estimation
Research Institute for Economics and Business Administration
Rokkodai-cho, Nada-ku, Kobe
Graduate School of Economics, Kobe University, Japan