Information moderation principle on the regulatory sandbox

Xiaohui Chen ()
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Xiaohui Chen: Yibin University

Economic Change and Restructuring, 2023, vol. 56, issue 1, No 5, 128 pages

Abstract: Abstract The regulatory sandbox, which promotes FinTech innovation, is expected to significantly improve the symmetry of regulatory information. However, it is not clear whether we should follow the principle of maximization or moderation when this occurs. Using the objective weighting CRITIC method, we calculate China's provincial FinTech innovation index from 2008 to 2019, to explore the relationship between regulatory information symmetry and the FinTech innovation level. The results show that regulatory information symmetry and FinTech innovation level have an inverted U-shaped nonlinear relationship. Following the improvement of symmetry in regulatory information, the FinTech innovation level first increases and then decreases. These findings are consistent with the predictions of the cognitive closure theory, cognitive needs theory, and optimal information theory. Therefore, we conclude that the regulatory sandbox should follow the principle of information moderation.

Keywords: Regulatory sandbox; Regulatory information symmetry; FinTech; Moderation principle (search for similar items in EconPapers)
JEL-codes: G18 G28 G38 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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DOI: 10.1007/s10644-022-09415-2

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