Sustainability of Local Public Finances from the Perspective of Territorial Disparities in the Rural Areas of Romania

For research article

Sustainability of local public finances from the perspective of territorial disparities in the rural areas of Romania

Response to Reviewer 1 Comments

1. Summary

Thank you very much for taking the time to review this manuscript. Please find the detailed responses below and the corresponding revisions/corrections highlighted in the resubmitted files.

2. A point-by-point response to Comments and Suggestions for Authors

Reviewer’s Comments

Response and Revisions

1. Introduction

Include additional sources in the paragraph from lines 45 to 53, which would prove the stated claims.

2 bibliographic titles have been added (lines 52-54). In total, 7 additional bibliographic sources have been added to the paper to reinforce the assertions

55-58 line: Also, prove the statement at the beginning of the next pause: "After the integration into the European Union, the possibility of using EU funds has...". Additional source or data.

The affirmation was strengthened by adding a new bibliographical source (line 58).

74-76 line: explain in more detail what "the basic administrative units" are in Romania (according to the Nomenclature of Statistical Territorial Units, which is the total number in Romania).

According to the official nomenclature, there are 2861 self-administered rural territorial units in Romania.

This idea has been added to the text (line 77).

The quality of the work would be improved if the results of similar research in other countries were cited. After the working hypothesis is defined, add the scientific papers that represent the foundation of this research.

We agree with this comment.

As suggested, similar research in other countries has been added (lines 93-95).

2. Literature Review

Line 171 states: "Studies on the efficiency and sustainability of public service budgets have also shown, at the county level (NUTS 3) a strong dependence on overall demographic trends." Indicate which are all the studies, in case additional ones are meant in addition to: Dincă M.S.; Dinca G.; Andronic M.L. Efficiency and Sustainability of Local Public Goods and Services. Case Study for 618 Romania. Sustainability, 2016, 8 (760). Or change the sentence to: "Study on the efficiency and sustainability of public service..."

Thank you for pointing this out.

The sentence was rephrased as suggested by the reviewer. Additional explanations were also provided (lines 175-180).

3. Data and Methodology

Add or specify with the help of which program the maps in the research were made. Under each map, indicate the source (Author or something else).

Adobe Illustrator CS12 was used to map the results. This was specified in row 219.

4.3. Typology of the revenue structure of local budgets in rural areas (2019-2023)

Separate Type 5 and Type 6 in a separate paragraph.

Types 5 and 6 have been separated into separate paragraphs (lines 324 and 332).

4.6. Factor analysis of the structure of local budgets in rural Romania (2019-2023)

The results of the factor analysis are poorly presented. It is necessary to add the results of the KMO and Bartlett's test, present the factor loading, and perform rotation if necessary. A more detailed interpretation of the factors is lacking. Also, factor scores can be calculated for each unit of observation, which would enable a better connection between the results of the factor analysis and the defined typology.

KMO and Bartlett test results have been added (lines 445-452).

Results of Bartlett and KMO tests are:

5. Conclusion

In conclusion, it is necessary to explain the results and the hypothesis in more detail. Also, add limitations and future research.

Thank you for pointing this out.

The results (lines 493 - 508) and the hypothesis (lines 538 - 541) were explained in more detail.

Response to Reviewer 2 Comments

1. Summary

Thank you very much for taking the time to review this manuscript. Please find the detailed responses below and the corresponding revisions/corrections highlighted in the resubmitted files.

2. A point-by-point response to Comments and Suggestions for Authors

Reviewer’s Comments

Response and Revisions

Section 3:

It would be better to provide a clear methodology framework covering AHC model (replace the existing description with a scheme or reorganize Table 1 to make the structure more visible).

Agglomerative hierarchical clustering (AHC)

It was made in XLStat2019 using the indicators presented in Table 1. This was specified in the text (line 200). The similarities between units are reflected by the dendrograms (figures 3,4 and 5), while each class has an individual profile, also visible in the figures mentioned above.

Section 4:

1) There is no evident relation between the research methodology and the results. How were the indicators described in section 3 addressed?

The dependent variable (total income) has been used in subchapter 4.1.1. (Income distribution). Based on this indicator, Figure 1 was constructed.

Explanatory (structural) variables (own income, government grants, European funds, personnel expenditure, social assistance expenditure, European-funded projects, capital expenditure, expenditure on education, health and culture) were used in subchapter 4.2. (Typology of rural areas according to local budget components) and in the realization of figures 3, 5 and 5.

The explanatory variables (determinants) (dynamics of population ageing, degree of rurality, wage income, level of education, presence of Roma communities, demographic size, position in relation to the county residence, and access to main transportation routes) were used in subchapter 4.3. (Factor analysis of the structure of local budgets in rural Romania)

All indicators in Table 1 can be found in the factor analysis (Tables 3 and 4 and Figure 6).

2) The paragraph in lines 224-233 seems to be similar to the discussion. It would be better to rephrase it or move after the results. Besides you have some discussion before presenting results (Line 253 'The analysis illustrates a real two-speed...').

Thank you for pointing this out.

We have reworded that paragraph (lines 236-231)

That sentence has been moved below (lines 258-259), after presenting the results and Figure 2.

3) I believe the Results and Discussion section should be structured more thoroughly (creating subsections as 'Indicators/Components', 'Typologies' and 'Factors analysis'.

We agree with this comment.

Chapter 4 has been restructured according to the suggestions received. Subsections (4.1., 4.2. and 4.3.) and Subsubsections (4.1.1., 4.1.2., 4.2.1. etc.) have been created.

Section 5:

To improve the manuscript valuability, I suggest indicate future research directions and research limitations.

Limitations of the study (lines 580-584) and future research directions (585-589) were specified.