For the relevance of gravity factors for capital flows see the seminal papers of Portes, Rey and Oh (2001) and Portes and Rey (2005). For bank flows, distance, cultural factors such as language and legal traditions, regulations, or and other political or institutional factors were shown to play an important role (Buch 2005, Brueggemann et al.
2011, Hermann and Mihaljek 2010, Niepmann 2015, or Papaionnaou 2009). For evidence on the micro-level see, for instance, the special issue of the International Journal of Central Banking (IJCB) provides evidence on cross-border prudential spillovers (Buch and Goldberg 2017). 10.ECB (2018: p. 6-7) and Bhatia et al.