The Impact of Marketization on Enterprise Performance from the Perspective of Enterprise Debt
Round 1
Reviewer 1 Report
This paper investigates how regional marketization affects the debt burden faced by local enterprises. Using empirical data from the Chinese market, the authors found that the improvement of marketization reduces corporate debt and increases corporate productivity. Overall, the research topic is interesting and important, and the methodology used in empirical analyses is appropriate. The empirical results are consistent across different model settings, and endogeneity problems are discussed and addressed properly. Policy implications are also examined. It is a well-written paper with publication potential.
I do have a few suggestions to highlight the contribution of the paper and make it more persuasive:
First, please provide a formal hypothesis design section. In this section, please discuss the limitations in the extant literature, comment on the competing theories and findings around the research topic, provide potential explanations for the influential mechanisms, and highlight how empirical analysis may render support for one explanation over others.
Second, please use a separate section to discuss the limitations of this paper and the directions for future studies.
Third, in the empirical analyses, please discuss the marginal effects of key variables and emphasize the economic significance of the analytical results.
Fourth, in the empirical analyses section, it appears that the data covers a sample period from 1998 to 2007, which is more than 15 years ago. Please explain why this sample period was chosen. I would like to see the authors incorporate more recent data in their analyses. If the findings can only be applied to the pre-2008 financial crisis period, the contribution of the paper would be significantly discounted.
Fifth, please provide detailed summary statistics for the key variables used in the regressions.
Finally, I noticed some formatting issues in the current submission. For example, "[Error! Bookmark not defined.]" appeared many times in the paper. Please correct the formatting problems in the next submission.
The quality of English is fine in general; there are some formatting issues need to be corrected.
Author Response
Please see the attachment
Author Response File: 
Author Response.pdf
Reviewer 2 Report
Comments:
1. is there any gap in the existing literature that your study fills?
2. why did you select this period (1998-2007) as sample period?
3. You wrote that "Then, using equation (3) to analyze the influence mechanism of external environment 442 and internal governance on total factor productivity of enterprises. Since the Hausman 443 test results reject the random effects model, we report the fixed effects model results." But, Hausman test is the test should be used to test the consistency of FE and RE methods results.
4. Have you test the signficance of cross-section, period effects?
5. how did you control the size, ownership structure and other effects of firms?
6. How did you solve the endoneity and unobserved heterogeneity problems?
Suggestions:
1. Move out the Figure 1 in Introduction and put it to data anlaysis section.
2. It is better you move some tables and figures to appendix. It is hard to follow your discussions.
It is better if a publication editor reads and corrects the paper.
Author Response
Please see the attachment
Author Response File: Author Response.pdf
Reviewer 3 Report
The research entitled “The impact of marketization on enterprise performance-based on the perspective of enterprise debt” is interesting and well structured, some references are missing including their related bookmarks.
However, I believe, there are several issues that need to be clarified and adjusted to make it more contextual specifically since China has a high economic growth that wasn’t mentioned in the study, even though the topic of corporate debt is a threat to China's economic growth and its financial stability.
1- The authors need to rephrase the paragraph related to the structure of the manuscript in the introduction section:” “This paper is organized as follows: The second part is the literature review and theoretical framework of deleveraging; the third part puts forward a simple theory; the fourth part is the empirical test of the theory; finally, the summary and policy recommendations”. By replacing theory with a conceptual model that is tested empirically or with research model to be tested in part 4 etc…
2- The authors need to replace the “our research” “we “ etc…and use for instance “ the authors conducted…” “ the research objective is to…” don’t use personal pronouns in a scientific paper.(line 157, 195,207,219….) (206,381…)
3- What are mainly the literature gaps they are trying to fill, except the fact of lack of studies, which is not the case…we have numerous studies that investigate the impact of regional marketization on the debt load of small businesses, and are Chinese companies taken in this article SMALL FIRMS? Some are public or mixed….
4- Furthermore, the study's sample of firms is good, however the data is old!!!! We are in 2023, and numerous changes in governance, economic growth, indebtedness, and so on have occurred in China! Taking into account the covid-19 period as a whole is a significant and innovative topic...In times of crisis, what influence did debt and marketization have, and did Chinese enterprises do well? The data ranges from 1998 to 2007, with some gaps.
5- The research's ultimate conclusions and findings are that improving marketization not only directly reduces firm debt, but also indirectly reduces debt load by increasing enterprise efficiency and supporting enterprise property rights reform, thus my concern is: is it achievable in China? Is this transparency tolerated in the workplace culture?
Good luck!
minor editing for english
Author Response
Please see the attachment
Author Response File: Author Response.pdf
Round 2
Reviewer 1 Report
The authors have made significant improvements in the current submission. My prior comments are addressed properly. I do not have further concerns. It is a well-written paper.
Author Response
Thank you very much for your review and suggestions.
Reviewer 2 Report
The paper is improved based on comments.
there might be a need for proofreading.
Author Response
The full text has been proofread and modified in the text. Thank you for your review and suggestions !
Reviewer 3 Report
The authors have taken into consideration all my comments and improved their manuscript ; however, minor changes are still needed for the results findings and presentations , i believe it would be more readable to summarize the findings and results , moreover to link them to litterature gap.
Good luck
minor editing
Author Response
The existing literature mainly discusses the issue of market-oriented transformation and resource allocation efficiency, and believes that market-oriented transformation is conducive to improving resource allocation efficiency [13, 14, 15]. With the improvement of resource allocation efficiency, capital can be transferred from inefficient areas to efficient areas, thereby increasing TFP [16, 17]. Market-oriented transformation also promotes property rights reform, and the participation of non-state-owned shareholders in the high-level governance of state-owned enterprises can alleviate government intervention and thus increase corporate productivity [10]. There is not much literature on the impact of market-oriented transformation on corporate debt, and there is little literature on the impact of productivity on corporate debt [18, 19]. The existing literature is more empirical in studying the relationship between policy and corporate deleveraging, and although there are discussions on the mechanisms of deleveraging, they are mostly indirect mechanisms, with little discussion on the intrinsic direct mechanisms, and do not reflect the role of the intrinsic direct mechanisms of corporate productivity on deleveraging [3-9]. This paper integrates the market-oriented external environment and internal corporate governance into a unified framework, and discusses not only the indirect mechanisms of market-oriented transformation and property rights re-form on corporate deleveraging, but also the intrinsic direct mechanisms of deleveraging through improving corporate productivity. This paper establishes a research frame-work, taking market-oriented transformation and property rights reform as exogenous institutional shocks, to explain the way in which China improves corporate performance by means of institutional improvement. The key step is to internalize exogenous institutions (market-oriented transformation and property rights reform) into corporate production efficiency (productivity), thereby improving corporate debt ratio. Using the 1998-2007 industrial enterprise database of the National Bureau of Statistics and the provincial marketization process index calculated by [20], this paper empirically examines whether market-oriented transformation and property rights reform are conducive to corporate deleveraging.（Line 71- Line 97）
Thank you very much for your review and suggestions!
