Gauging Linguistic Complexity of Regulatory Communication: A Case Study for India

Regulatory communications are complex, boring and difficult to understand.

Nishita Raje, Khaijamang Mate, Sayli Londhe and Sandhya Kuruganti of RBI study the Linguistic Complexity of Regulatory Communicationin India:

With increased scope and scale of regulation, there is growing awareness for adoption of simple or plain language in central bank’s regulations. This article attempts to measure the linguistic complexity of written regulatory communication in India. It analyses a set of circulars issued by the Department of Regulation (DoR), Reserve Bank of India. The focus is on the complexity of the language used in regulatory communication rather than complexity implicit in regulation by the very nature of the area/aspect that is being regulated. It aims to capture various dimensions of linguistic complexity and contributes towards developing a multifaceted understanding of the subject.

Highlights:

• • Text mining techniques have been leveraged to study different dimensions of linguistic complexity.
  • A sample of circulars of Department of Regulation, Reserve Bank of India, applicable for banks were subjected to commonly used readability indicators.
  • These readability indicators suggest that most circulars require at least graduate level education, which is generally the education level of commercial bank employees.
  • A composite score was developed to rank circulars based on linguistic complexity.
  • There is no visible change in readability scores across the years, though in 2020-21, regulations were smaller and scored better in readability.

Clearly there is a need to simplify the regulatory communications.

Struggles of getting a licence to open new banks in India

RBI recently rejected two applications that had applied for Small Finance Bank licences.

My piece in Deccan Herald on the struggles of getting bank licences.

Unlocking the power of ideas: The power of ideas across history

ECB President Christine Lagarde in this speech  poinst to the power of ideas and how ideas shape history.

By inspiring action, ideas can help us grow. This might be personal growth – a student’s learning, say, allowing them to make the right decisions throughout their future career. But it holds at the societal level too: ideas help push our economies forward.

In recent decades, we had few barriers globally to the flow of ideas. Advanced economies shared their technologies with emerging ones, and emerging economies shared their cheaper input costs with us – the process we knew as “globalisation”.

But in recent years, the global economic order as we know it has been changing.

We now see that previously emerging economies are taking leadership in some advanced technologies. And we are seeing globalisation go into reverse, threatening access to the resources on which advanced technologies depend.

So, how do we all prosper in this new world?

I will argue today that the key ingredient for our prosperity remains the same as ever: generating and sharing new ideas.

But history tells us that ideas can only drive growth if we first create the right conditions that allow them to reach their full potential – and if we are committed to breaking the bottlenecks that stand in their way.

This is the challenge we all face today to thrive in this new world. And today, I will focus on what this challenge means for our economies and, in particular, for Europe.