• "Extreme Natural Disasters and Sudden Stops in Capital Flows" (Link: The Latest Version)

Abstract:

Natural disasters represent a threat to financial stability. This paper studies the role of extreme natural disasters as a trigger of sudden stops in capital inflows, both empirically and quantitatively. Using quarterly data for advanced and emerging economies and identifying extreme disasters through their physical intensity, I find that the response to disasters differs across both groups and resembles a sudden stop mainly in emerging economies. In these economies, the probability of a sudden stop rises after a disaster, together with a reversal of the current account, a fall in asset prices and a contraction of economic activity. The evidence also suggests that the effect of disasters is not only transitory but also permanent. I then develop a real business cycle model with collateral constraints, calibrated to emerging economies, in which disasters destroy capital and lower both the transitory and the trend components of productivity. The model reproduces the dynamics observed in the data and shows that disasters raise the risk of a sudden stop by reducing the price of capital and therefore the value of collateral. This risk is driven mainly by the disruption of productive activity rather than by the destruction of capital. Finally, I show that disaster insurance covering only the direct damage of a typical disaster removes most of the increase in the risk of a sudden stop.

Presentations:

2026: Macro Workshop, UC3M (Madrid, Spain); 4th Macroeconomic and Financial Aspects of Climate Change, organized by Bank of Greece and European Economic Review, Nov. 2026 (Athens, Greece). 

2025: WorkShop PhD Students in Pontificia Universidad Católica de Chile (Santiago-Chile); Internal Seminar, Environment Center, Charles University (Prague, Czech Republic). 

• "The role of inequality in the optimal design of capital controls" (Link: The Latest Version)

Abstract:

Sudden stops in capital inflows are disruptive and costly events that can cause severe redistributive effects. In this paper, I investigate the role of inequality in the design of optimal capital controls that seek to mitigate the negative effects of these phenomena. To do so, I set up a small open production economy model with collateral constraints and two types of agents that are heterogeneous in income and borrowing capacities. I calibrate the model and use the model to study the response of the economy to exogenous shocks that produce a tightening of the collateral constraint and a reversal of the current account as observed during sudden stops. I then solve the constrained solution for a Social Planner´s problem that cares about both the standard pecuniary externality in these models and also redistribution. I use the model to disentangle the role of these two channels and find that inequality implies differentiated capital controls between high income and low income agents. While in normal times taxes are higher for high income households to prevent overborrowing, the planner allows low income households to borrow more to enable some redistribution. When the economy faces a sudden stop, taxes for all agents are reduced to nearly zero. Finally, I investigate the welfare effects of implementing a simple, constant, and uniform rule for capital controls.

Presentations:

2024: Macroeconomics Lunch Workshop at Centre de Recerca en Economía International – CREi (Barcelona – Spain); Czech Economic Society – CES (Prague - Czech Republic); Charles University (Prague - Czech Republic); Central Bank of Chile; Public Economic Theory – PET (Santiago-Chile). 

2023:  LACEA-LAMES in Pontificia Universidad Javeriana (Bogotá-Colombia); Sociedad de Economía de Chile in Universidad Diego Portales (Santiago-Chile); WorkShop PhD Students in Pontificia Universidad Católica de Chile (Santiago-Chile)

• "Monetary Policy Design and Gross Capital Flows", joint with David Kohn 

• "How do manufacturing exports react to RER and foreign demand? The Chilean case", The World Economy, 2020, with Miguel Fuentes and Jorge Fornero 

• "New Estimates of Chile's Real Neutral Interest Rate” (in spanish). Notas de Investigación de Economía Chilena, 2017, with Luis Ceballos and Jorge Fornero. 

• "Forecasting Chilean inflation with international factors", Empirical Economics, 2016, with Pablo Pincheira. 

• "Backtesting fan charts of activity and inflation: the Chilean case", Central Bank of Chile, Working Paper 881, June 2021, with Jorge Fornero. 

• 2026/2025. Professor - International Economics (in English) 

• 2026/2025. Professor - International Trade (in English) 

• 2027. Professor - International Macroeconomics (in English) 

• 2026/2025. Tutor - Trabajo de Fin de Grado - TFG (in Spanish)