@misc{12280,
title = {Dealing with the Dutch Disease: Fiscal Rules and Macro-Prudential Policies},
author = {García-Cicco, Javier and Kawamura, Enrique},
year = {2015},
doi = {10.18235/0011700},
abstract = {This paper evaluates from a welfare perspective three policy alternatives for dealing with Dutch disease problems originating from cyclical movements in commodity prices: fiscal rules for government expenditures, capital controls, and taxes on domestic lending.  A DSGE model of a small open economy is developed, with a sectoral decomposition that features three distinctive characteristics: financial frictions, a learning-by-doing externality in the industrial sector, and a fraction of households being non-Ricardian (credit constrained).  The model is calibrated using Chilean data.  For each policy tool, optimal simple rules are analyzed from a welfare (Ramsey) perspective, describing how different households rank the several policy alternatives, and studying how each of the models features shapes the optimal policy design.  A general conclusion of the analysis is that the included Dutch disease inefficiencies are of quantitatively limited relevance in analyzing the desirability of these policies from a welfare perspective.},
url = {https://doi.org/10.18235/0011700}
}