Do Foreign Direct Investment Inflows in the Producer Service Sector Promote Green Total Factor Productivity? Evidence from China
Round 1
Reviewer 1 Report
The submitted article focuses on examining the dual effects of SFDI on China's GTFP using the SBM-DDF measure and the GML index to estimate GTFP. Panel data for 20 Chinese provinces from 2006-2019 were used. A sophisticated econometric modeling methodology was applied and presented clearly and the research hypotheses were derived correctly based on the literature analysis. The multi-stage and complex econometric modeling included building a sub-stage model and a mediating model, as well as performing a causal effect robustness test and a mechanism robustness test, and regional heterogeneity analysis with moderating effect testing. The study showed that SFDI can influence GTFP through competition, green innovation, and resource allocation mechanisms. It is noteworthy that the impact of SFDI on GTFP shows regional heterogeneity. It further offered specific recommendations including increasing openness, improving input markets, and strengthening environmental regulations. For better reception by the international reader, the conclusions and suggestions formulated in Chapter 5 should be given a somewhat more universal character by aiming for more general findings. It would also be good to better explain the abbreviations used (such as FDI) in the introductory section ( and especially in the executive summary). With these corrections, the article is eligible for publication in the Sustainability journal.
Minor linguistic and editorial errors should be removed (e.g. errors in the numbering of subsections in point 4.4 - pages 12-13).
Author Response
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Author Response.pdf
Reviewer 2 Report
Comments for author File: Comments.pdf
Author Response
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Author Response File: Author Response.pdf
Reviewer 3 Report
The topic is highly relevant and novel, and the approach taken is innovative. The objectives of the article are clear and the authors set up four hypotheses. I would suggest merging the H2 and H4. Since they can be linked to different effects, it is proposed to present the hypotheses at the end of the Introduction session.
The applied data and calculations demonstrate the authors' high level of methodological competence. The results are completely confirmed by the data and tests. I recommend the paper for publishing, only minor revision is needed. My detailed comments are the following:
The article is 19 pages long. It would be possible to shorten some parts, especially the Introduction session (line 24-73 extensively). The 4. Results and Discussion session is complex too, maybe the tables (Table 2-7) can be moved to Annex.
The FDI in producer service sector (SFDI) and the green total factor productivity (GTFP) indicators should be clearly defined in the Introduction session.
In the Suggestions subsession, it is worth briefly mentioning that the results can be applied to other countries.
I kindly ask the authors to avoid using abbreviations as much as possible. For the sake of clarity, I suggest developing the list of abbreviations.
Author Response
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Author Response File: Author Response.pdf
Reviewer 4 Report
The article investigates the relationship between foreign direct investment (FDI) inflows in the producer service sector and green total factor productivity (TFP) in China. It examines whether FDI in this sector contributes to environmental sustainability and productivity growth. It analyses the specific impact of FDI in the producer service sector on green TFP, providing empirical evidence and insights that can inform policymakers and researchers interested in the relationship between foreign investment, environmental sustainability, and productivity.
The title adequately covers the aspects focused on in the paper. It provides a clear indication of the main subject and scope of the study. The keywords reflect the core of the paper and are appropriate for the topic under investigation.
Nevertheless, there exist various aspects that require improvement prior to its publication:
The paper presents new insights and findings that contribute to the existing scholarship in the field. However, the extent of this contribution is moderate, as the paper could have presented more innovative and groundbreaking ideas to further distinguish itself.
The paper is adequately structured into sections. However, some sections could benefit from further development and clarity to enhance the overall structure and coherence.
The content is generally well described and contextualized. However, there are instances where a deeper exploration of the theoretical underpinnings could have strengthened the analysis and provided a more comprehensive understanding of the topic.
The selection of references could be more diverse and could include a broader range of sources to strengthen the paper's arguments and support its claims effectively. There are a few instances where the connection between the cited references and the research topic is not clear. More careful selection of references would have enhanced the credibility and strength of the paper's arguments, namely regarding the link between FDI and firms’ productivity.
I suggest incorporating the following references:
Kimura, F., & Kiyota, K. (2006). Exports, FDI, and productivity: Dynamic evidence from Japanese firms. Review of World Economics, 142, 695-719.
Tomiura, E. (2007). Foreign outsourcing, exporting, and FDI: A productivity comparison at the firm level. Journal of International Economics, 72(1), 113-127.
Newman, C., Rand, J., Talbot, T., & Tarp, F. (2015). Technology transfers, foreign investment and productivity spillovers. European Economic Review, 76, 168-187.
Santos, E., & Khan, S. (2019). Foreign direct investment policies and catching up. Journal of Applied Economic Sciences, 13(7 (61)), 1821-1853.
Ahmed, E. M., & Kialashaki, R. (2023). FDI inflows spillover effect implications on the Asian‐Pacific labour productivity. International Journal of Finance & Economics, 28(1), 575-588.
Li, M., & Wang, J. (2023). The productivity effects of two-way FDI in China’s logistics industry based on system GMM and GWR model. Journal of Ambient Intelligence and Humanized Computing, 14(1), 581-595.
Santos E. FDI and Firm Productivity: A Comprehensive Review of Macroeconomic and Microeconomic Models. Economies. 2023; 11(6):164.
Spithoven, A., & Merlevede, B. (2023). The productivity impact of R&D and FDI spillovers: characterising regional path development. The Journal of Technology Transfer, 48(2), 560-590.
The chosen method is discussed in the paper. However, it is not clear if it is the best method for studying the research question. The implementation of the method is not thoroughly explained, leaving room for ambiguity. It would have been helpful to include more details on the methodology to allow for replication and further evaluation. Additionally, the paper does not discuss alternative methods to research the topic, which would have strengthened the overall analysis.
The research design, questions, hypotheses, and methods are not clearly stated in the paper. The lack of clarity in these aspects hinders the overall understanding of the study and the evaluation of its validity and reliability.
The results are not clearly presented. There is a need for clearer presentation of data, statistical analyses, and interpretation of findings. This would enable readers to better understand and evaluate the outcomes of the study.
There is a lack of a clear logical progression in the presentation of ideas and interpretation of results. Additionally, the analysis does not thoroughly address potential alternative explanations or limitations, which weakens the overall strength of the paper's arguments.
The conclusion does not thoroughly support the results presented in the article or reference the secondary literature. It would have been beneficial to provide a more comprehensive discussion of how the conclusions align with the findings and how they contribute to the broader body of knowledge.
The suggestions for future research are limited in scope and could have been more comprehensive. More specific directions for future studies would have added value to the paper.
There are some grammatical errors and awkward phrasing throughout the text. Improvement in clarity and coherence of the language is needed to enhance the overall quality of the english.
Author Response
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Author Response File: Author Response.pdf
Round 2
Reviewer 4 Report
Dear Authors,
I am writing to express my satisfaction with the final version of your manuscript. The revisions and improvements made have greatly enhanced the overall quality of the work. Your efforts and attention to detail are commendable.
Best regards
