Measuring Regulatory Complexity
Thank you for your interest in our experiment. We have designed a set of regulations that determine the risk-weighted assets of a bank. This is defined as the bank's assets weighted according to their risk. We define these risk-weights in a hypothetical regulation that we show you as part of the experiment.
We ask you to compute the risk-weighted assets for 10 different sets of regulations, the first of which is a practice question. In our experiment, we study how humans perceive complexity, so some hypothetical regulations will be more complex than others. The experiment measures how often you can compute the risk-weighted assets correctly and how long you need.
Let's get started!