Impact of Foreign Enterprises’ Capital Inflow on Urbanization Factors: Evidence from Northeastern Cities of China

Round 1

Reviewer 1 Report

The manuscript presents findings on the influence of capital entry of foreign enterprises on urbanization factors, using data from northeast China's cities. The paper covers an interesting topic and the achievements can be useful for other case studies.

However, there are some criticisms in the manuscript that must be addressed.

1. The current Introduction should be further improved. The current version is lacking of logic. The authors may consider restructure the introduction as: motivation/background-literature review-aim and contribution-organization of the remains of the study.

2. To clarify the contributions of this study, the authors should point out the current specific knowledge gap more clearly.

3. 1.1, 1.2 and 1.3 1.1, 1.2 and 1.3 would be more appropriately placed in the Theory and Hypotheses section.

3. The authors measure urbanization in terms of Urban labor force, Emission density and Services productivity, which are clearly not representative indicators of urbanization. Therefore, the credibility of this study’s results needs to be further discussed.

4. The calculation of the urbanization index is not clear.

5. Table 5. Multivariate regression results using fixed effect and random effect

The L.ln_FC coefficients of the fourth model, in contrast to the previous three, have large differences and need to be analyzed and discussed in focus.

6. The originality and novelty of the paper needs to be further improved and clarified.

7. Writing needs to be significantly improved.

8. The literatures reviewed in the manuscript seem to be out of date. It is recommended that the authors can update the introduction by adding some recently published ones.

can be improved

Author Response

Reviewer 1:

Comments and Suggestions for Authors

The manuscript presents findings on the influence of capital entry of foreign enterprises on urbanization factors, using data from northeast China's cities. The paper covers an interesting topic and the achievements can be useful for other case studies.

Response:

Thank you so much for taking the time to review my manuscript. I'm very glad that you found the topic interesting, and I appreciate your comments on the findings. Your feedback has helped me a lot in improving my manuscript and has also been valuable for my thesis writing. Overall, I appreciate your thoughtful comments!

 

 

1. The current Introduction should be further improved. The current version is lacking of logic. The authors may consider restructure the introduction as: motivation/background-literature review-aim and contribution-organization of the remains of the study.

Response:

I've made the changes to the Introduction as per your suggestion. I've restructured it to include motivation/background, literature review, aim and contribution, and the organization of the rest of the study. I hope the revised version aligns with what you expected.

I added the following paragraph:

The significance of this research stems from the imperative to formulate effective urban policies, particularly in the context of increasing capital investments. Understanding the impact of foreign investments on urbanization levels, environmental pollution, and the provision of essential services is of paramount importance, particularly in developing countries. In the case of China, there is a burgeoning interest in the trend of urbanization. Policymakers are placing greater emphasis on ensuring an adequate number of job opportunities, Improving the economic environment, and Improvement for the quality of people’s life in response to the rapid urbanization trend. Especially that some selective foreign investments have reshaped urbanization in Chinese cities. Chen and Wu [11] highlight FDI's role in regional urbanization disparities, aligning with earlier research [23-27]. FDI significantly draws rural migrants to urban centers. The primary objective of this research is to examine the relationship between foreign investments and urbanization in northeastern Chinese cities. By doing so, this study seeks to offer valuable insights to policymakers for strategic planning aimed at attracting foreign investment to the region.

Additionally, environmental concerns are arising due to substantial emissions originating from various sources. Where previous empirical studies, as documented in the works of scholars such as [36-54], have undertaken an examination of the intricate relationship between urbanization and emission levels. While certain studies have delineated a causative nexus between urbanization and pollution emissions, others, for various reasons, failed to discern a substantial impact. Despite divergences in findings, urbanization consistently emerges as a factor correlated with emissions, gaining increased attention as the pace of urbanization intensifies. The environmental issues have become increasingly pronounced with the acceleration of urbanization. Notably, following the initiation of China's economic liberalization and industrial reforms, the country's urbanization has undergone marked advancements [37], the secondary objective of this research is to quantitatively assess the magnitude of the influence exerted by foreign investments on the urban environment within the northeastern cities of China. This aspect of the study aims to contribute to a better understanding of the environmental implications associated with foreign capital inflow. Furthermore, in alignment with the United Nations' objectives aimed at enhancing the well-being of populations, this research examines how embracing foreign investments can lead to advancements in service quality within the economy and consequently improve the welfare of citizens. Our examination of the extant literature has revealed a notable gap regarding the impact of foreign investments on service productivity, a topic that has been relatively underexplored with only a limited number of studies dedicated to its investigation. In light of this identified gap, the current study is deemed imperative to address this relationship. Our third objective is to empirically investigate and analyze the effects emanating from foreign capital investments on the development of services within urban cities. Thus, this research contributes substantially to the existing body of literature by examining the effects across a selection of Chinese cities.

 

2. To clarify the contributions of this study, the authors should point out the current specific knowledge gap more clearly.

Response:

I 've addressed the knowledge gaps more clearly in the previous paragraph.

 

 

3. 1.1, 1.2 and 1.3 1.1, 1.2 and 1.3 would be more appropriately placed in the Theory and Hypotheses section.

Response:

Thank you for pointing that out. Initially I was confused with the journal template. However, I have now incorporated sections 1.1, 1.2, and 1.3 into the Theory and Hypotheses section, as your suggestion.

 

 

3. The authors measure urbanization in terms of Urban labor force, Emission density and Services productivity, which are clearly not representative indicators of urbanization. Therefore, the credibility of this study’s results needs to be further discussed.

Response:

Thank you for this comment. The choice of Urban labor force as an indicator for measuring urbanization in Chinese cities was driven by the availability of data in recent years. The traditional method of using the proportion of urbanized people in cities versus the rural population was not available due to data limitations. I addressed this in the paper and referenced studies highlighting the inadequacy of traditional indicators, particularly when focusing on the labor force, This discussion is presented in the section titled "Definitions of Variables in the Study."

Regarding pollution emissions per capita, the choice was made to provide a detailed understanding of urbanization's environmental impact. This approach aligns with the concept of green urbanization. Also, The consideration of services development aims to evaluate the sustainability and economic serviceability of the urban areas.

I would also  mentioned that the study of Grekou and Owoundi in 2020, in the African region used indicators such as urbanization rate, concentration in the biggest city, CO2 emissions in urban areas, and services value-added. As proxies for Urbanization. Drawing inspiration from their methodology, I adapted it to the context of Chinese cities, considering the available data and specificities of the region.

I appreciate your concerns about emphasizing the relevance of the indicators in the right context.

 

 

4. The calculation of the urbanization index is not clear
   Response:

I added the following paragraph regarding how the index was calculated. In addition I applied some other modifications that can be found in Definitions of Variables in the Study section

Lastly, the values of the urbanization index are calculated based on the following equation:

 

                   

(1)

Where the urbanized labor force  was given a weight of 0.5, reflecting its primary role in urbanization. Emission density  received a weight of -0.3, suggesting the negative impact of emissions on urban sustainability and quality of the environment. The added value of services      was weighted at 0.2, indicating its significance but secondary role to welfare level in urban regions. A positive index value indicates more sustainable and green urbanization, while a negative value suggests potential adverse consequences from one or more of the urbanization elements.

 

5. Table 5. Multivariate regression results using fixed effect and random effect

The L.ln_FC coefficients of the fourth model, in contrast to the previous three, have large differences and need to be analyzed and discussed in focus.

Response:

In the fourth model, the L.ln_FC coefficient in Table 5 is (-0.130***), indicating a negative relationship. This negative relationship is attributed to the significant impact of Urb_Poll, as the urb_index is positively influenced by both urban labor and services value added but negatively affected by the Urb_Poll coefficient. After including the urbanization index equation, I believe that the resulting coefficient will be clearer.

 

6. The originality and novelty of the paper needs to be further improved and clarified.

Response:

The novelty of the paper lies in its focus on providing a fresh perspective and enhancing the overall understanding of foreign capital investments on urbanization elements

In addition to the three points mentioned in the introduction, I added the following part:
“Fourthly, distinct from previous literature, the approach of measuring urbanization was different, for example, the focus of this study shifts from the percentage of all urban populations to the percentage of employed people in urban areas. Because using the entire urban population could yield distracting results, while the employment-based indicator is better suited to represent the proportion of the workforce that may be influenced by foreign direct investments. Additionally, the utilization of SO2 as an indicator provides valuable insights into environmental and health impacts. Calculating pollution emissions per capita further refines precision within the urbanization context. Moreover, the incorporation of the urbanization index enables the assessment of the comprehensive impact of foreign capital investment on the promotion of sustainable and environmentally friendly urbanization. These four aforementioned points highlight the uniqueness and significant contributions of the study”

Moreover, We have revised the conclusion to included detailed policy recommendations that address environmental challenges resulted from foreign capital inflow. In addition, we hope the conclusion now better present the study's implications.

 

7. Writing needs to be significantly improved.

Response:

We have conducted extensive improvements throughout the entire manuscript, focusing on English editing and overall enhancement of the writing quality. Kindly check the attached edited version.

 

8. The literatures reviewed in the manuscript seem to be out of date. It is recommended that the authors can update the introduction by adding some recently published ones.

Response:

Thank you for your comment !  we have made sure to include some recent literature related to this topic.

 

 

 

 

Author Response File: Author Response.pdf

Reviewer 2 Report

I commend the authors for their research investigating the impact of foreign capital inflow on urbanization factors, particularly in the context of northeastern Chinese cities. Overall, the manuscript is well-structured and addresses an important topic. However, I have several recommendations for improvement:

General Comments:

1. The abstract provides a concise summary of the study. However, it could benefit from further clarification regarding the specific findings and implications of the research. A brief mention of the methodology and key results would enhance the abstract's comprehensibility.

2. While the manuscript outlines the data collection sources and reasons for selecting northeastern provinces, it lacks details about the data cleaning and preprocessing steps. Providing insights into data quality control measures and any potential biases would strengthen the validity of the study's results.

3. The manuscript briefly touches on the results, emphasizing the negative environmental impact of foreign capital investments. To enhance the manuscript, consider providing more in-depth discussions on the mechanisms through which foreign capital influences urbanization and the environment.

4. The conclusions and policy recommendations are important aspects of the manuscript. To improve clarity, elaborate on the specific policy measures that should be taken to address the environmental challenges posed by foreign capital inflow. Additionally, discuss the potential limitations of these recommendations.

5. The manuscript is generally well-organized. However, I recommend refining the flow of information in the "Conclusions" section to ensure that the key findings and policy recommendations are clearly presented.

Minor editing of English language required

Author Response

Reviewer 2:

I commend the authors for their research investigating the impact of foreign capital inflow on urbanization factors, particularly in the context of northeastern Chinese cities. Overall, the manuscript is well-structured and addresses an important topic. However, I have several recommendations for improvement:

Thank you so much for taking the time to review my manuscript. I'm very glad that you found the topic interesting, and I appreciate your comments on the findings. Your feedback has helped me a lot in improving my manuscript and has also been valuable for my thesis writing.

 

General Comments:

1. The abstract provides a concise summary of the study. However, it could benefit from further clarification regarding the specific findings and implications of the research. A brief mention of the methodology and key results would enhance the abstract's comprehensibility.

Response:
Thank you for your feedback. We have updated the abstract to include more details on specific findings, implications, and a brief mention of the methodology. Your suggestions have been incorporated for improved comprehensibility.

 

2. While the manuscript outlines the data collection sources and reasons for selecting northeastern provinces, it lacks details about the data cleaning and preprocessing steps. Providing insights into data quality control measures and any potential biases would strengthen the validity of the study's results.

Response:

We have addressed the concern regarding data cleaning in the manuscript. You can find detailed information on these steps, including ways of solving some issues with the data, in the “Data Collection Sources” section.

 

3. The manuscript briefly touches on the results, emphasizing the negative environmental impact of foreign capital investments. To enhance the manuscript, consider providing more in-depth discussions on the mechanisms through which foreign capital influences urbanization and the environment.

Response
Thank you for your this comment . We have expanded the relevant sections in the manuscript to provide a more comprehensive discussion on this matter.  I hope these modifications will provide better understanding of this manuscript.

4. The conclusions and policy recommendations are important aspects of the manuscript. To improve clarity, elaborate on the specific policy measures that should be taken to address the environmental challenges posed by foreign capital inflow. Additionally, discuss the potential limitations of these recommendations.

Response

We have revised the manuscript to include detailed policy recommendations addressing environmental challenges due to foreign capital inflow. Additionally, the conclusion has been updated to better highlight the implications of our study. We also discuss potential limitations of the study to provide a comprehensive view.

 

5. The manuscript is generally well-organized. However, I recommend refining the flow of information in the "Conclusions" section to ensure that the key findings and policy recommendations are clearly presented.

Response

As mentioned in the previous comment, we have refined the conclusions to ensure a clearer presentation of the manuscript. We appreciate your comments and believe these modifications have enhanced the quality of this manuscript.

Author Response File: Author Response.pdf

Reviewer 3 Report

Title: Examining the Influence of Capital Entry of Foreign Enterprises on Urbanization Factors: Evidence from North-eastern Cities of China

 

Manuscript no:

 

Overall Comments: I would like to acknowledge the authors for their valuable contributions to the field of urbanization in China. The topic is both timely and important, and the study offers interesting insights.

I would like to highlight the importance of this manuscript's work, as it addresses an important area of ​​research that has far-reaching implications for both current scholars and future researchers. The topic is significant, and the information is well-structured. However, a couple points could use extra development and clarity in order to strengthen the paper's overall impact.

 

Comments and Suggestions:

 

Title:  This paper gives a very good insight into determining the effects of the inflow of foreign capital on urbanization. I would just suggest adding “Impact of Foreign Enterprise Capital Inflow…….” in the title and rest is ok.

 

Abstract: I suggest adding details about the model and methodology that was used to assess the impact of foreign capital use on urbanization. Rewrite the conclusive lines in the abstract, as it needs to be change for better understanding.

 

Introduction: The introduction should provide a clear and concise definition of the research scope and clearly state the research objectives.

 

Literature Review and hypothesis: This section has nicely explained. However, the included citations (20, 21, 22, 28, 31, 33, 55, 71, 72, 94, 95, and 102) are pretty old. Therefore I would suggest citing recent studies.

Research methodology: This section is explained well. However, why did you choose Multivariate Regression Models instead of dynamic panel model? I recommend adding a 'data source' column to Table 1, which summarizes the study variables and their measurements.

 

Conclusion: The concluding section lacks a discussion of the implications of the study, particularly the strategies that other researchers and policymakers can draw from the findings. The practical relevance and effect of research will grow by addressing these wider consequences.

 

Grammer and language must be improved. 

Author Response

Reviewer 3:

 

Overall Comments: I would like to acknowledge the authors for their valuable contributions to the field of urbanization in China. The topic is both timely and important, and the study offers interesting insights.

I would like to highlight the importance of this manuscript's work, as it addresses an important area of ​​research that has far-reaching implications for both current scholars and future researchers. The topic is significant, and the information is well-structured. However, a couple points could use extra development and clarity in order to strengthen the paper's overall impact.

Response:
Dear Reviewer, Thank you very much for your thoughtful comments on our work on urbanization.  Also, we highly appreciate your recognition of the significance of our research and its implications, We agree that some certain points can be further developed for better view of this manuscript,

 

Comments and Suggestions:

 

Title:  This paper gives a very good insight into determining the effects of the inflow of foreign capital on urbanization. I would just suggest adding “Impact of Foreign Enterprise Capital Inflow…….” in the title and rest is ok.

 Response:

Thank you for this comment. Yes, We believe this title you suggested "Impact of Foreign Enterprise Capital Inflow" would be more suitable for the manuscript. We have made the necessary changes.

 

 

Abstract: I suggest adding details about the model and methodology that was used to assess the impact of foreign capital use on urbanization. Rewrite the conclusive lines in the abstract, as it needs to be change for better understanding.

 Response:

 We have included additional details about the model and methodology for clarity. Moreover,   the abstract was revised and modified to ensure better understanding.

 

 

 

Introduction: The introduction should provide a clear and concise definition of the research scope and clearly state the research objectives.

 Response:

We have revised the introduction and  provided a clearer explanation of the research importance and research gaps and have explicitly clarified the research objectives.

 

 

Literature Review and hypothesis: This section has nicely explained. However, the included citations (20, 21, 22, 28, 31, 33, 55, 71, 72, 94, 95, and 102) are pretty old. Therefore I would suggest citing recent studies.

 Response:

Thank you for your comment. We have addressed this request and added additional and  more recent references into the literature review.

 

 

 

Research methodology: This section is explained well. However, why did you choose Multivariate Regression Models instead of dynamic panel model? I recommend adding a 'data source' column to Table 1, which summarizes the study variables and their measurements.

 Response:
Dear reviewer, we choose multivariate regression models in order to estimate the current relationship between urbanization factors (the dependent variables) with the independent variables , particularly foreign investment. This choice was made to evaluate the influence of foreign investment rather than lagged urbanization or its dynamic effects, However, we do understand the benefits of using the dynamic models. We will consider this approach in our future extended research.

Regarding the second part of the comment, We have expanded the Data Collection Sources section and mentioned the data source once . since certain variables required information from multiple sources. adding additional column may consume extra space. We appreciate your suggestion, but we believe it's best to maintain the current format

 

 

 

Conclusion: The concluding section lacks a discussion of the implications of the study, particularly the strategies that other researchers and policymakers can draw from the findings. The practical relevance and effect of research will grow by addressing these wider consequences.

Response

Thank you for your suggestion. We have revised the conclusion to included detailed policy recommendations that address environmental challenges resulted from foreign capital inflow. In addition, we hope the conclusion now better present the study's implications. We have also mentioned some limitation points.

Author Response File: Author Response.pdf

Reviewer 4 Report

I have added just few suggestions

Comments for author File: Comments.pdf

Author Response

Dear Reviewer,

Thank you for your invaluable feedback. I have carefully applied the suggested changes to the manuscript and addressed each comment one by one. However, due to technical constraints, I was only able to upload one file. I sincerely appreciate all the insights you provided, and they have greatly enriched the manuscript.

Thank you so much for your understanding and guidance

Author Response File: Author Response.pdf

Round 2

Reviewer 1 Report

The authors have revised and improved the manuscript, however, there are some previous issues that have not been resolved.

1. The study cites a large amount of literature (35), with 18 citations in line 52, line 196. Such citation is too hasty and simplistic. It is recommended that the authors cite the literature wisely, citing some literature that is closely related to the paper.

With so much relevant literature available, what are the highlighted contributions of this paper compared to the existing literature?

2. “Where the urbanized labor force was given a weight of 0.5, reflecting its primary role in urbanization. Emission density received a weight of -0.3, suggesting the negative impact of emissions on urban sustainability and quality of the environment. The added value of services was weighted at 0.2, indicating its significance but secondary role to welfare level in urban regions.”

How are the weights (0.5, 0.3 and 0.2) calculated, or are they arbitrarily assigned by the authors themselves?

In addition, there are relevant treatments for both forward and reverse indicators, but the authors’ treatment is rare, the weights are generally summed up to 1, but the authors assign weights (0.5, -0.3 and 0.2). Therefore, the rationality of this calculation process need to be verified.

3. Table 5. Multivariate regression results using fixed effect and random effect

The L.ln_FC coefficients of the fourth model, in contrast to the previous three, have large differences and need to be analyzed and discussed in focus.

Authors need to address in detail the reasons for this result and whether it is justified or not.

4. The authors measure urbanization in terms of Urban labor force, Emission density and Services productivity due to data limitations. Such an explanation is clearly unconvincing.

Perhaps the authors could argue the soundness and science of the approach based on some of the relevant literature

The authors have revised and improved the manuscript, however, there are some previous issues that have not been resolved.

1. The study cites a large amount of literature (35), with 18 citations in line 52, line 196. Such citation is too hasty and simplistic. It is recommended that the authors cite the literature wisely, citing some literature that is closely related to the paper.

With so much relevant literature available, what are the highlighted contributions of this paper compared to the existing literature?

2. “Where the urbanized labor force was given a weight of 0.5, reflecting its primary role in urbanization. Emission density received a weight of -0.3, suggesting the negative impact of emissions on urban sustainability and quality of the environment. The added value of services was weighted at 0.2, indicating its significance but secondary role to welfare level in urban regions.”

How are the weights (0.5, 0.3 and 0.2) calculated, or are they arbitrarily assigned by the authors themselves?

In addition, there are relevant treatments for both forward and reverse indicators, but the authors’ treatment is rare, the weights are generally summed up to 1, but the authors assign weights (0.5, -0.3 and 0.2). Therefore, the rationality of this calculation process need to be verified.

3. Table 5. Multivariate regression results using fixed effect and random effect

The L.ln_FC coefficients of the fourth model, in contrast to the previous three, have large differences and need to be analyzed and discussed in focus.

Authors need to address in detail the reasons for this result and whether it is justified or not.

4. The authors measure urbanization in terms of Urban labor force, Emission density and Services productivity due to data limitations. Such an explanation is clearly unconvincing.

Perhaps the authors could argue the soundness and science of the approach based on some of the relevant literature

Author Response

Reviewer 1:

The authors have revised and improved the manuscript, however, there are some previous issues that have not been resolved.

1. The study cites a large amount of literature (35), with 18 citations in line 52, line 196. Such citation is too hasty and simplistic. It is recommended that the authors cite the literature wisely, citing some literature that is closely related to the paper.

 

With so much relevant literature available, what are the highlighted contributions of this paper compared to the existing literature?

 

Response

Thank you for your feedback and suggestions. We have carefully reviewed the citations in the manuscript and have reduced the number to ensure that each reference is directly relevant to the context cited. Our intention in citing a large number of studies was not to provide a big list of all research on the topic, but rather to emphasize the established link between urbanization and emissions. This was done to show the significance of considering emissions as a component of urbanization.

Secondly, The contribution here in our paper is not to study the direct effect of urbanization on emissions, as this relationship has been well-documented in previous research. Instead, our focus is on examining the impact of foreign capital investment on emissions, both as an individual component and as a weighted part of an index. This offers a novel way to investigate the interaction between foreign investment and urban environment with other related factors, especially in the northeastern part of China.

 

 

 

 

 

2. “Where the urbanized labor force was given a weight of 0.5, reflecting its primary role in urbanization. Emission density received a weight of -0.3, suggesting the negative impact of emissions on urban sustainability and quality of the environment. The added value of services was weighted at 0.2, indicating its significance but secondary role to welfare level in urban regions.”

 

How are the weights (0.5, 0.3 and 0.2) calculated, or are they arbitrarily assigned by the authors themselves?

 

In addition, there are relevant treatments for both forward and reverse indicators, but the authors’ treatment is rare, the weights are generally summed up to 1, but the authors assign weights (0.5, -0.3 and 0.2). Therefore, the rationality of this calculation process need to be verified.
Response

We initially set the weights (0.5, 0.3, and 0.2) based on discussions with our supervisor. We understand that this approach might appear arbitrary, and we highly appreciate this comment to ensure our research is trusted and transparent.

We recognize the standard treatments for both forward and reverse indicators, where weights generally sum up to 1. However, given the feedback and our further contemplation, we used different way of assigning the weights.

We have now adopted the approach of determining weights using the Principal Component Analysis (PCA) method. This choice stems from PCA is broadly acceptance in diverse research domains for dimensionality reduction . the key point of using PCA is that it offers insight into the variance-covariance structure of the variables, allowing for weights that reflect the significance of each variable in explaining the variance.

An important clarification regarding PCA is that the weights (or loadings) do not necessarily need to sum to one. They represent the correlation between the original variables and the principal component. where having weights that do not sum to one is acceptable and expected using this approach.

Considering these changes, we believe our revised methodology is more robust and aligned with standard practices. We thank the reviewer for their significant contribution in offering such a useful comments and hope our adjustments address their concerns.

 

 

 

 

3. Table 5. Multivariate regression results using fixed effect and random effect

 

The L.ln_FC coefficients of the fourth model, in contrast to the previous three, have large differences and need to be analyzed and discussed in focus.

 

Authors need to address in detail the reasons for this result and whether it is justified or not.

Response

In the first three models, we utilized log-transformed values of the indicators. This transformation help in linearizing relationships and stabilize the variances, resulting in coefficients that reflect the percentage change in the dependent variable for a percentage change in the independent variable. For the fourth model, the dependent variable Urb_indx, was calculated using normalized values of these three indicators. We normalized these indicators to ensure their comparability in the index, given the different scales they might affect its validity. This normalized index was then regressed against the same set of independent variables as in the first three models. The process of normalization and the use of this index can influence the regression coefficients, especially when comparing them with models that use non-normalized, log-transformed indicators.

We added this paragraph in the results section after Table 5:

In this analysis, the nature of the dependent variable "Urb_index" differs from the first three dependent variables. Specifically, the first three models use individual indicators derived from log-transformed values. In contrast, the "Urb_index" indicator is constructed using the normalized values of these three indicators to account for their different scales. This approach ensures that the influence of each component aligns with its variability. This might explain the variations in coefficient magnitudes, especially when comparing across models.

 

 

4. The authors measure urbanization in terms of Urban labor force, Emission density and Services productivity due to data limitations. Such an explanation is clearly unconvincing.

 

Perhaps the authors could argue the soundness and science of the approach based on some of the relevant literature

Response

Thank you for pointing out this. We understand the concern raised. However, Our selection of Urban labor force, Emission density, and Services productivity as proxies for urbanization was deliberate and not due to data limitations. These indicators were chosen based on their relevance and significance in the urbanization context, and they reflect sustainable aspect of urbanization.

1. Urban Labor Force the focus of this study shifts from the percentage of all urban populations to the percentage of employed people in urban areas. Because using the entire urban population could yield distracting results, while the employment-based indicator is better suited to represent the proportion of the workforce that may be influenced by foreign direct investments .
   also as mentioned in Definitions of Variables in the Study  paragraph  --- Measuring the urban population by the traditional method is to take the number of urbanized people in the cities as a proportion of the whole population; however, this traditional way is not adequate when focusing on the labor force [7, 20, 24, 37, 128].
2. Emission Density: Environmental considerations, especially emissions, have become increasingly central to urbanization studies. High emission densities are often linked to rapid urban development, the utilization of SO2 as an indicator provides valuable insights into environmental and health impacts. Calculating pollution emissions per capita further refines precision within the urbanization context. Moreover, the incorporation of the urbanization index enables the assessment of the comprehensive impact of foreign capital investment on the promotion of sustainable and environmentally friendly urbanization.,
   In addition, the impact of emissions related to foreign capital was extensively discussed in the section titled " The foreign capital investments inflow effects on environmental pollution" within the context of urbanization.
3. Services Productivity: As cities urbanize, there's a noted shift from agriculture to services. Also, the growth of urban areas leads to a higher demand for services, and cities become more interconnected. In addition to the literature provided under the title "The effects of foreign capital investments on service productivity," we conclude that the growth of the service sector is a relevant indicator of urbanization.

Also we would like to clear that the mention of "data limitations" in the end of the research paper was in the context of exploring foreign capital effects based on industry types and not a justification for our choice of urbanization indicators. We apologize for any confusion.

We would like to extend our heartfelt gratitude to the reviewer for dedicating their valuable time and providing insightful feedback. Your constructive comments have greatly contributed to the improvement of our manuscript and thesis. Thank you very much for your generosity and expertise.

 

Author Response File: Author Response.pdf

Reviewer 3 Report

The author has revised manuscript in the light of the comments. It only further required to be considered for English editing and improvement.  

Improvement in English editing is required. 

Author Response

Dear Reviewer
Thank you for your constructive feedback on the need for improvements in the English editing of our manuscript. We have reviewed the text and applied the necessary refinements and corrections to enhance its clarity, grammatical accuracy, and overall readability. 

We would kindly invite you to check the readability of the revised text and we hope it meets your expectations.

Author Response File: Author Response.docx

Round 3

Reviewer 1 Report

The author addressed well considered my opinion and I have no further comments

The author addressed well considered my opinion and I have no further comments