Score contribution per author:
α: calibrated so average coauthorship-adjusted count equals average raw count
In this paper we study how foreign lending by Italian banks adjust to prudential policy changes of destination markets over the period 200014. We find a positive prudential spillover effect: Italian banks tend to lend more to countries that tighten a prudential measure. The impact is not very large nevertheless, and it is driven by cross-border lending and lending by hosted branches that are not directly affected by the changes in regulations. This evidence highlights the need for international cooperation among authorities.