opening a royal palace in Wales could bring in an extra £36m in tourism spending, a report has said.
Gorwel, an independent non-party Welsh think tank, said the case for an official royal residence should be considered, saying it could attract thousands of visitors but be seen as an extravagance.
But the Wales Green Party, which opposes the monarchy, said the tourism benefit had been exaggerated, BBC reported.
Unlike the other nations of the UK, there is no official residence for a member of the royal family in Wales.
Gorwel's report examined the case for and against setting up a royal palace in Wales to match those elsewhere.
Doing so would give Wales political and economic benefits, it argued, leading to a long-term increase in tourism numbers and create up to 100 jobs.
The report suggested between £765,000 and £3.6 million ($1m and $5.1m) annually could be generated in tourism income, as well as a further £510,000 - £2.4m ($726,000-$3.4m) in indirect spending with between 55,680 and 266,927 visitors a year.
But the report's authors, Prof Russell Deacon and Scott Prosser, also list potential drawbacks including that it could be seen as extravagant during a time of austerity.
They said it could also distract or displace tourism for other sites and was "unlikely to be a substantially profitable enterprise".
There would also likely be "significant costs" in renovating an existing building or establishing a new one, while security and anti-terrorism measures "could act as a substantial drain on the public purse".
Prof Deacon said: "There are a number of royal events coming up, which benefit other capitals, such as London and bring in increased tourism there.
"Perhaps we should share some of that as well, we're part of the United Kingdom and in that respect we should have a royal residency here too."
Royal author and broadcaster Brian Hoey said: "If there were to be a royal residence here in Wales, it would increase the profile of Wales not only throughout the United Kingdom, but throughout the world."
The leader of Green Party Wales, Grenville Ham, said: "We've already got 600 castles in Wales, we've already got mountains that bring people here. I think the tourism benefit is hugely exaggerated.
"I don't think the royal family need another home, they've got plenty. If they want to build something in Wales, they should build social housing."
The Green Party previously called for the queen to be evicted from Buckingham Palace and moved into a council house.