Journal of Financial Economics Vol. 174 2025
Measuring regulatory complexity
Abstract
We propose a framework to study regulatory complexity, based on concepts from computer science. We distinguish different dimensions of complexity, classify existing measures, develop new ones, compute them on three examples — Basel I, the Dodd–Frank Act, and the European Banking Authority’s reporting rules — and test them using experiments and a survey on compliance costs. We highlight two measures that capture complexity beyond the length of a regulation. We propose a quantitative approach to the policy trade-off between regulatory complexity and precision.
- DOI
- 10.1016/j.jfineco.2025.104186
- Volume
- 174
- Pages
- 104186
- Language
- en
- Sources
- bibtex:phds-export.bib crossref openalex