Review Reports - Impact of Anti-Corruption on the Sustainability of Local Government Debt in China: The Moderating Role of Fiscal Transparency

Round 1

Reviewer 1 Report

Comments and Suggestions for Authors

In their work, the authors examine an important topic related to the effects of anti-corruption efforts on local government debt. This is indeed a very timely piece of research, especially given that local governments often bear a heavy burden handed to them by the central bureaucracy. This study has several obvious advantages, but I'll let you highlight the disadvantages.

1. The research gap should leave the scientific literature, and now it turns out that the author proposes to examine a practical problem.

2. You should provide the Chinese context about Chinese local government, because the reader may be interested in learning about how Chinese local government works;

3. Section literature analysis includes a general analysis of literature on anti-corruption, but does not focus on anti-corruption in local government. I would recommend for inspiration: Dvorak, J. (2023). Assessment of the Risks of Financial Crimes in Local Government. In Management Strategies and Tools for Addressing Corruption in Public and Private Organizations (pp. 197-215). IGI Global.

4. It is necessary to describe debt sustainability.

5. It is not very clear what the purpose of the investigation is, it is not written anywhere. It is only noted about the research contribution.

6. However, there can be a discussion in the conclusions. Still, the conclusions must also be there, because now there is a discussion, recommendation, limitation and future directions, but there are no conclusions and no policy implications. I would recommend moving the discussion to a separate section. Maybe you don't need recommendations.

All the best

Author Response

POINT-BY-POINT RESPONSE TO REVIEWERS

Manuscript ID：sustainability-3078715

Dear Reviewers,

Thank you for the time and attention you devoted to our paper. As requested by the Editor-in-Chief, we provide below a detailed point-by-point response to your comments.

RESPONSE TO REVIEWER 1

Reviewer: 1

Comments and Suggestions for Authors:

Authors’ reply:

Thank you very much for your appreciation for our work, which encourages us a lot.

The research gap should leave the scientific literature, and now it turns out that the author proposes to examine practical problem.

Authors’ reply:

Your valuable suggestion is highly appreciated, and correspondingly we have modified and improved the content of the research gap in the Introduction, so that the proposal of questions is based on practical background and theoretical research gap. We balanced the practice and theory of research questions. The research can not only solve the practical problem but also supplement the existing research gap. The details are as follows:

“Most existing research on the implications of anti-corruption focuses on the mi-cro(enterprise) level, discussing its influence on enterprise innovation[11] and merger and acquisition activities[12] and so on. Some on the macro-level implications of anti-corruption predominantly concentrates on the environment [13], economy [14] and other areas. However, most of these studies begin with enterprises and discuss their influence on the macro level from a micro perspective, rarely involving the anti-corruption of officials. Only a small amount of attention has been paid to the role of anti-corruption by government officials, such as its impact on government performance [15] and credibility [16]. Simultaneously, investigations into the determinants of government debt sustainability have mainly centered on two direct factors: fiscal [17] and debt[18], as well as external shocks, such as the European Central Bank (ECB)'s Pan-demic Emergency Purchase Program (PEPP) [19] and the coronavirus pandemic[2]. Nevertheless, there is little research on the impact of China's anti-corruption campaign targeting officials on government debt sustainability. Existing studies have acknowledged that corruption increases government debt [6] and exacerbates fiscal deficits [5]. Therefore, it is necessary and valuable to consider China's anti-corruption campaign targeting officials as an external shock and analyze its impact on government debt sustainability. Furthermore, previous studies indicate that heightened fiscal transparency can mitigate corruption[20], facilitate anti-corruption efforts[21] and be important to debt sustainability[22]. Based on the above practical background and theoretical research, the research questions of this paper are proposed:” Please see details in page 2-3, line 65-84.

2.you should provide the Chinese context about Chinese local government, because the reader may be interested in learning about how Chinese local government works.

Authors’ reply:

Thank you very much for your helpful advice. With your advice, we added the Chinese context about Chinese local government. We analyzed the path of corruption of local government officials and the anti-corruption work done by the Chinese government. The details are as follows:

“In China, due to "GDP worship"[8] and the "promotion incentive"[9] of the polit-ical and economic system, government officials are encouraged to issue more bonds to stimulate economic growth during their term [10], often ignoring fiscal revenue, expenditure alignment, and long-term debt sustainability. This may lead to official corruption, seriously harming debt sustainability. Chinese authorities recognize the im-portance and urgency of anti-corruption targeting government officials. The Beijing Declaration against Corruption and the Joint Convention against Corruption were re-leased in 2014, signifying the initiation of the anti-corruption campaign targeting officials. According to data from China's Central Commission for Discipline Inspection, in 2022, discipline inspection and supervision organs across the nation filed 596,000 cases and penalized 592,000 individuals. Additionally, the notion of the "normalization of anti-corruption" was introduced during the 20th National Congress of that year, further underscoring China's unwavering commitment to combat corruption.” Please see details in page 2, line 52-64.

Section literature analysis includes a general analysis of literature on ani-corruption, but does not focus on anti-corruption in local government. I would recommend for inspiration: Dvorak, J. (2023). Assessment of the risks of financial crimes in local government. In management strategies and tools for addressing corruption in public and private organizations (pp. 197-215). IGI Global.

Authors’ reply:

Thank you very much for your helpful advice. With your advice, I read the articles of Dvorak, J., and found that he has a deep study on financial crimes of China, especially the analysis of local government in China, which has benefited us a lot. Therefore, we join the study to our paper as important references, which provide a good support for our research, especially Section 3, and enhance the scientific value of our paper. Please see details in page 5, line 226.

References:

Dvorak, J., Assessment of the Risks of Financial Crimes in Local Government. In Management Strategies and Tools for Addressing Corruption in Public and Private Organizations, IGI Global: 2023; pp 197-215.

It is necessary to describe debt sustainability.

Authors’ reply:

Thank you for your advice, which has enabled me to discover the shortcomings in debt sustainability interpretation. According to your suggestion, based on the concept of debt sustainability in 2.1, in the part about debt sustainability variables, we further elaborate the basic concept of debt sustainability from the perspective of "fiscal fatigue" based on existing literature before calculating debt sustainability. The details are as follows.

“Local Government Debt Sustainability (SUSTAIN): This paper draws on Xia et al. [62] to measure local government debt sustainability by considering the idea of available fiscal space. Available fiscal space represents the current fiscal budget space supporting economic development, Ghosh et al. [30] defined it as the difference between current debt ratios and the computed debt limit. Building upon this definition, Li and Du [32] introduce a fiscal expenditure efficiency index to construct ‘effective fiscal space’” Please see details in page 8, line 320-326.

it is not very clear what the purpose of the investigation is, it is not written anywhere. It is only noted about the research contribution.

Authors’ reply:

Thank you for your suggestion. According to your suggestions, we highlight the research question, and based on it, the research purpose are expounded in the following content. The details are as follows:

“To address the above research questions, in the context of the current global debt sustainability dilemma, this paper focuses on China's anti-corruption campaign targeting officials and utilizes a sample of 30 provincial-level administrative regions in China to investigate how anti-corruption efforts affect debt sustainability and to assess the moderating influence of fiscal transparency. Additionally, this paper conducts a deeper analysis of whether disparities exist in the effects of anti-corruption on debt sustainability and the moderating influence of fiscal transparency across regions with differing levels of economic development in China.” Please see details in page 3, line 89-96.

However, there can be a discussion in the conclusions. Still, the conclusions must also be there, because now there is a discussion, recommendation, limitation and future directions, but there are no conclusions and no policy implications. I would recommend moving the discussion to a separate section. Maybe you don’t need recommendations.

Authors’ reply:

Your valuable comment is helpful to us. As your comment, we divided the original discussion part into a separate section (Section 6) for more in-depth analysis, and the empirical results are linked with the research conclusion. The details are as follows.

“Through the empirical process in the previous section, this paper tested the hypothesis and further analyzed the heterogeneity of regional economic development. This section mainly discusses the empirical results based on existing research.

First, this paper identifies that anti-corruption efforts can improve local government debt sustainability, supporting hypothesis H1. Previous research suggests that debt sustainability is contingent on the solvency and debt levels of local governments. Moreover, corruption leads to increased public debt [6] and reduced solvency (higher fiscal deficits) [43]. The findings support these two views from the perspective of anti-corruption, link them and expand upon them. It posits that strengthened anti-corruption measures can enhance government solvency by boosting government revenue and reducing expenditure, and can reduce debt levels by optimizing debt management. Consequently, it contributes to the improved sustainability of local government debt.

Second, this paper verifies hypothesis H2, that is, fiscal transparency can positively regulate the role of anti-corruption in promoting local government debt sustainability. Previous research has demonstrated that fiscal transparency promotes anti-corruption [21]and contributes to debt sustainability[22]. The result of this paper supports and extends them. In delving further into the interaction between fiscal transparency and these factors, this paper observes that enhanced fiscal transparency facilitates an-ti-corruption in fiscal and debt-related domains. Consequently, this strengthens anti-corruption's impact on government debt solvency and debt levels, thereby significantly enhancing its role in promoting government debt sustainability.

Thirdly, further regional heterogeneity analysis reveals that under China's political and economic system, in regions with better development levels, anti-corruption has a more significant effect on debt sustainability, and the moderating effect of fiscal transparency is amplified. The finding supports hypotheses H1 and H2 again, providing proof of their robustness. It also supplements existing research on the relationship between corruption and debt in different economic development regions [3]. This pattern is primarily attributed to the fact that regions with higher economic development offer more support for anti-corruption initiatives, making them easier to implement. Additionally, these regions tend to exhibit greater fiscal transparency, al-lowing the role of anti-corruption in promoting debt sustainability to flourish better, and providing a more ideal environment for the moderating of fiscal transparency effect to thrive.” Please see details in page 19-20, line 717-748.

At the same time, we integrated the main findings of the research in the first paragraph of the conclusion (Section 7), and changed “policy recommendations” into “policy implications”. The details are as follows.

“Against the backdrop of China's debt risk prevention and control, and an-ti-corruption campaign targeting officials, this paper focuses on 30 provincial-level administrative regions in China. It employs panel data from 2010 to 2017 to examine the impact of anti-corruption on local government debt sustainability, while introducing fiscal transparency as a moderating variable to further analyze its influence on their relationship. The primary findings of this study are as follows: (1) Increased an-ti-corruption efforts can effectively enhance the sustainability of local government debt. (2) In regions characterized by high fiscal transparency, the effectiveness of an-ti-corruption efforts in promoting local government debt sustainability is bolstered, highlighting a positive moderating role for fiscal transparency. (3) Regional heterogeneity analysis reveals a progressive increase in the influence of anti-corruption efforts on local government debt sustainability and the moderating effect of fiscal transparency from the western to the central and eastern regions of China.” Please see details in page 20, line 750-762.

Author Response File: Author Response.pdf

Reviewer 2 Report

Comments and Suggestions for Authors

Below are some specific suggestions to improve the article:

Improve Contextualisation and Succinctness: The introduction and literature review sections should be more succinct. Highlight how your research fits into the existing body of knowledge and explicitly state the novel contributions of your study.

Clarify Research Questions and Hypotheses: Ensure that the research questions and hypotheses are explicitly stated early in the paper. This will provide a clear framework for the reader to understand the subsequent analysis.

Balance in Discussion: The discussion should be more balanced. While highlighting the positive findings is important, it is equally crucial to discuss the limitations of your study and consider alternative explanations for your results.

Explicit Link Between Results and Conclusions: Strengthen the link between your empirical findings and the conclusions drawn. Discuss how your results specifically support your hypotheses and the broader implications of your findings for policy and practice.

Update References: Ensure that you are engaging with the most recent scholarship. Incorporating newer studies will provide a more current context for your research and demonstrate that you engage with ongoing debates in the field.

Policy Implications: Expand the discussion on the policy implications of your findings. Given the applied nature of your research, it is important to provide concrete recommendations for policymakers based on your results.

Clarify Statistical Tables: While your statistical tables are clear, providing more detailed explanations in the text will help readers who may not be as familiar with statistical methods understand the implications of your findings.

Author Response

POINT-BY-POINT RESPONSE TO REVIEWERS

Manuscript ID：sustainability-3078715

Dear Reviewers,

Thank you for the time and attention you devoted to our paper. As requested by the Editor-in-Chief, we provide below a detailed point-by-point response to your comments.

RESPONSE TO REVIEWER 2

Reviewer 2：

Comments and Suggestions for Authors:

Improve context and succinctness: the introduction and literature review sections should be more succinct. Highlight how your research fits into the existing body of knowledge and explicitly state the novel contributions of your study.

Authors’ reply:

Thank you for your comment. Based on your comment, we have revised the overall structure of the Introduction and simplified the content. At first, we have carried on more analysis of the relevant research, so that the research questions can be better embedded in the existing research system. The details are as follows:

“Most existing research on the implications of anti-corruption focuses on the micro(enterprise) level, discussing its influence on enterprise innovation[11] and merger and acquisition activities[12] and so on. Some on the macro-level implications of anti-corruption predominantly concentrates on the environment [13], economy [14] and other areas. However, most of these studies begin with enterprises and discuss their influence on the macro level from a micro perspective, rarely involving the anti-corruption of officials. Only a small amount of attention has been paid to the role of anti-corruption by government officials, such as its impact on government performance [15] and credibility [16]. Simultaneously, investigations into the determinants of government debt sustainability have mainly centered on two direct factors: fiscal [17] and debt[18], as well as external shocks, such as the European Central Bank (ECB)'s Pan-demic Emergency Purchase Program (PEPP) [19] and the coronavirus pandemic[2]. Nevertheless, there is little research on the impact of China's anti-corruption campaign targeting officials on government debt sustainability. Existing studies have acknowledged that corruption increases government debt [6] and exacerbates fiscal deficits [5]. Therefore, it is necessary and valuable to consider China's anti-corruption campaign targeting officials as an external shock and analyze its impact on government debt sustainability. Furthermore, previous studies indicate that heightened fiscal transparency can mitigate corruption[20], facilitate anti-corruption efforts[21] and be important to debt sustainability[22].” Please see details in page 2-3, line 65-83.

Secondly, we have adjusted the contributions to the last part, section 7 (Conclusion), and revised the content. We linked it to the research conclusion, and compared it with the existing research to highlight the theoretical contribution of this research. The details are as follows:

“The main theoretical contributions of this paper are as follows:

(1) In the context of China's anti-corruption campaign targeting officials, this pa-per provides empirical evidence for the promotion effect of anti-corruption efforts on local government debt sustainability. Existing research on the effects of anti-corruption primarily examines its impact on government performance and credibility from a governmental viewpoint [15, 16]. This paper extends this inquiry to encompass government debt sustainability. In addition, while research on the prevailing determinants influencing debt sustainability has focused on numerous external policy shocks [19, 39], China's anti-corruption campaign targeting officials, though overlooked, is examined within this article as a policy shock affecting debt sustainability to investigate the impact of anti-corruption efforts on local government debt sustainability.

(2) Fiscal transparency was introduced as a moderating variable to analyze its moderating effect on the relationship between anti-corruption and local government debt sustainability. This promotes the relevant research on the influence of financial transparency on anti-corruption and debt sustainability. Existing studies have demonstrated that fiscal transparency has an impact on anti-corruption and government debt sustainability, respectively[20, 22]. However, there is no research to explore its influence on the relationship between these two factors. This paper employs fiscal transparency as an external moderator to investigate how varying degrees of fiscal transparency affect the relationship between anti-corruption and the sustainability of local government debt. It is a deepening on the relationship between them.

(3) This paper examines variations in the impact of anti-corruption on local government debt sustainability across regions with different levels of economic development in China, as well as the distinctions in the moderating effect of fiscal transparency. Existing research suggests regional disparities in the impact of corruption on debt [3, 43]. This paper expands the investigation of the link between anti-corruption efforts and debt sustainability to diverse regions and scrutinizes the heterogeneous effects induced by varying economic development levels within China's economic system, thus contributing a valuable dimension to existing research.” Please see details in page 20, line 762-794.

Clarify research questions and hypotheses: ensure that the research questions and hypotheses and explicitly stated early in the paper. This will provide a clear framework for the reader to understand the subsequent analysis.

Authors’ reply:

Thank you for your valuable advice. Here we set out the research questions in a separate paragraph. And in the research questions, we used alternative questions to preliminary convey the hypothesis to the reader, which highlights the research question. In this way, as your suggestion, readers can better understand the subsequent analysis of our research. The details are as follows:

“Q1: Can the anti-corruption campaign targeting government officials effectively improve the sustainability of local government debt?

Q2: How does fiscal transparency influence the relationship between an-ti-corruption and debt sustainability?” Please see details in page 3, line 85-88.

Balance in discussion: the discussion should be more balanced. While highlighting the positive findings is important, it is equally crucial to discuss the limitations of your study and consider alternative explanations for your results.

Authors’ reply:

Your valuable suggestion is highly appreciated. Follow your suggestion, we firstly separated the discussion part as Section 6 (Discussion) and made an in-depth analysis to link the empirical results with conclusions. The details are as follows:

Secondly, we revised the limitations and future directions (Section 7.3) to make it more consistent with the research results and process. So that we can clarify the limitation of our study, and put forward the future research direction. The details are as follows:

“This paper explores the impact of anti-corruption on local government debt sustainability and the moderating influence of fiscal transparency on their relationship. It offers theoretical insights and policy recommendations to address the sustainability challenges of local government debt in China. Nonetheless, several limitations necessitate future research. First, the data from the sample period spanning 2010 to 2017 is utilized in this paper to validate the hypothesis. However, it should be acknowledged that the sample period does not extend to the present time. This is due to the challenges related to data consistency and availability. As research progresses, more comprehensive data can be accessed in the future to further substantiate the paper's conclusions. Second, this paper delves into China's anti-corruption campaign as an external shock on debt sustainability. The findings hold substantial value for comprehending debt sustainability within China or regions with similar policy framework. Nonetheless, it remains to be ascertained through further validation whether these conclusions can be extrapolated to nations characterized by different policy framework and political systems, such as in territories devoid of anti-corruption measures or those operating under alternative political regimes. This will serve to ascertain the generalizability of the conclusions. Third, the heterogeneity analysis revealed that variations in regional economic development levels also exert an impact on how anti-corruption efforts in-fluence the government debt sustainability, as well as the moderating effect of fiscal transparency. While this conclusion has been substantiated within China, it inherently confines our comprehension of the phenomenon. Thus, future research is implored to broaden the investigative lens by examining this issue across national boundaries or within diverse regional contexts of multiple countries to deepen the re-search.” Please see details in page 21-22, line 836-858.

Explicit link between results and conclusion: strengthen the link between your empirical findings and the conclusions drawn. Discuss how your results specifically support your hypotheses and the broader implications of your findings for policy and practice.

Authors’ reply:

Thank you for calling our attention to this important point. To solve this problem, we have divided the discussion into a separate section (Section 6) for further discuss. In the analysis, we combined the empirical results and research conclusions, and discussed how the research results support the hypothesis. The details are as follows:

Update references: ensure that you are engaging with the most recent scholarship. Incorporating newer studies will provide a more current context for your research and demonstrate that you engage with ongoing debates in the field.

Authors’ reply:

Thank you for your suggestions. We added the methods and data used in this paper to the abstract as follows:

We read the new studies in 2023 and 2024, and selected seven articles highly relevant to our study, updating the existing reference to ensure that our research engage with ongoing debates in the field. Including：

Zhang, M.; Chen, W.; Kou, A.; Wu, Y., Promotion incentives, tenure uncertainty, and local government debt risk. Finance Research Letters 2023, 56, 104136.
Wang, X.; Chu, X.; Lee, C.-C., How does anti-corruption policy affect the sensitivity of green innovation to executive incentives? Economic Change and Restructuring 2023, 56 (1), 79-109.
Yuan, S.; Pan, X.; Li, M., The nonlinear influence of innovation efficiency on carbon and haze co-control: The threshold effect of environmental decentralization. Environment, Development and Sustainability 2023, 25 (12), 14283-14307.
Shi, X., Anti-corruption campaign and economic growth in Chinese cities: The dichotomous mechanism of network-based political competition. European Journal of Political Economy 2024, 83, 102549.
Zhang, M.; Chen, W.; Kou, A.; Wu, Y., Promotion incentives, tenure uncertainty, and local government debt risk. Finance Research Letters 2023, 56, 104136.
Oyadeyi, O. O.; Agboola, O. W.; Okunade, S. O.; Osinubi, T. T., The debt-growth nexus and debt sustainability in Nigeria: Are there reasons to be concerned? Journal of Policy Modeling 2024, 46 (1), 129-152.
Dvorak, J., Assessment of the Risks of Financial Crimes in Local Government. In Management Strategies and Tools for Addressing Corruption in Public and Private Organizations, IGI Global: 2023; pp 197-215.

Policy implications: expand the discussion on the policy implications of your findings. Given the applied nature of your research, it is important to provide concrete recommendations for policymakers based on your research.

Authors’ reply:

Your valuable comment is helpful to us. Follow your comment, we have refined the policy implications (section 7.2). We mainly introduced the main findings into the policy implications. And put forward corresponding policy implications through the application of findings. Ensure that the policy implications are supported by the research process to achieve concreteness. The details are as follows:

“(1) The research in this paper confirms that anti-corruption contributes to the enhancement of local government debt sustainability. Therefore, it is imperative to continue promoting the anti-corruption campaign targeting officials and embrace the concept of "normalization of anti-corruption", maintaining a relentless crackdown on corrupt government officials. This entails the following actions: first, strict enforcement of fiscal revenue and expenditure budget management, alongside the approval processes for fiscal fund allocation, can mitigate corruption in fiscal operations and enhance the government's capacity to service debts. Second, optimizing the debt management system, encompassing measures such as bond issuance approval and continuous fund usage monitoring, to eliminate corruption opportunities in debt issuance and management. This approach will lead to a reduction in government debt levels and improve the plight of government debt sustainability.

(2) The conclusion of the study on the moderating effect shows that elevating fiscal transparency strengthens the positive impact of anti-corruption efforts on government debt sustainability. To achieve this, pertinent government information should be dis-closed to heighten fiscal transparency. This involves two key facets: firstly, publicly divulging information related to fiscal revenue, expenditure, and debt management to leverage public oversight in promoting anti-corruption in these domains. Secondly, revealing government affairs pertaining to the populace's well-being can enhance the government's credibility. This, in turn, boosts public confidence in economic development, raises public expectations, attracts capital inflow to stimulate the economy, garners public support and engagement in anti-corruption endeavors, and reinforces the path for anti-corruption to influence government debt sustainability.

(3) Heterogeneity analysis found that in regions with good economic development level, the promoting effect of anti-corruption on debt sustainability and the positive moderating effect of financial transparency would be enhanced. Therefore, the implementation of policies on anti-corruption and financial transparency should be reinforced in economically underdeveloped regions. This comprises two primary con-tents. Firstly, intensifying the implementation of anti-corruption policies in economically backward areas, where the resources required for effective anti-corruption measures are often limited. Thus, increasing anti-corruption investments in economically disadvantaged regions and fortifying anti-corruption efforts becomes crucial to enhance government debt sustainability. Secondly, the government should mandate the disclosure of public affairs information in strict compliance with relevant regulations and systems to enhance fiscal transparency. This will strengthen the moderating effect of fiscal transparency on the enhancement of anti-corruption efforts in government debt sustainability. Ultimately, this approach not only improves government debt sustainability but also fosters economic development in less developed areas.” Please see details in page 21, line 797-834.

Clarify statistical tables: while your statistical tables are clear, providing more detailed explanations in the text will help readers who may not be similar with statistical methods understand the implications of your findings.

Authors’ reply:

Thank you very much for your suggestions. After checking all the statistical tables, we found that the problems you suggested were obvious in Table A1, so we made major modifications to it. It mainly including the explanation of core variables and data sources, as well as the analysis of descriptive statistical results of variables. The details are as follows:

“Based on the above fiscal response function, the dependent variable is Primary Balance Ratio (PB), which is expressed by the ratio of fiscal revenue, transfer payment income minus non-interest fiscal expenditure to GDP, referencing the research of Li and Du [36]. Independent variables include Primary Balance Ratio with one-period lag and Debt Ratio with one, two, three-period lag. The control variables refer to Ghosh et al. [33] and Li and Du [36], and considering data availability, the paper selects fiscal expenditure gap, output gap, GDP growth rate, trade openness, fixed asset investment growth rate, and fiscal decentralization as the control variables (denoted as X_i,t ) in the fiscal response function. Fiscal expenditure gap and output gap refer to the ratio of difference between the real value and the potential value to the potential value. The calculation of the potential value follows the study by Li and Du [36], using HP filtering to eliminate the trend of the actual value. Trade openness is expressed by exports and imports as a share of GDP. Fiscal decentralization is expressed as a proportion of the per capita local fiscal revenue and the sum of the per capita local and central fiscal revenue.

The samples used for calculating the fiscal response function are consistent with those used for hypothesis testing in this paper, which include 30 provincial administrative regions in China from 2010 to 2017. The data sources of all variables are primarily derived from the China Statistical Yearbook, China Fiscal Yearbook, and Wind database. Descriptive statistical analysis was conducted to understand the preliminary characteristics of the data. The definitions and descriptive statistics of all variables are presented in Table A1.” Please see details in page 23, line 797-834.

“According to the descriptive statistics in Table A1, the maximum value of the primary balance ratio is 0.0164, the minimum value is -0.126, and the standard deviation is 0.016. This indicates that there is little difference in the fiscal status of different regions. However, the mean value of -0.00907 suggests that the fiscal status of most regions is not optimistic due to fiscal deficits. The maximum and minimum values of the Debt ratio are 0.673 and 0.0011, respectively. This indicates that all regions have significant debt, with some regions reaching up to 67.3%. The average value of 0.117 further highlights the severity of the debt situation. The statistical characteristics of the control variables are consistent with existing studies, making them suitable for the next step in solving the financial response function.” Please see details in page 24, line 923-932.

Author Response File: Author Response.pdf

Reviewer 3 Report

Comments and Suggestions for Authors

The purpose of the paper is to analyze the impact of anti-corruption on local government debt sustainability in China, considering some moderating variables. The paper is very well structure, I appreciate the authors ‘effort in documenting the hypothesis. The contribution is well written. Please note I am not an expert on mathematical formulas, but from my point of view the paper can be published.

Author Response

POINT-BY-POINT RESPONSE TO REVIEWERS

Manuscript ID：sustainability-3078715

Dear Reviewers,

Thank you for the time and attention you devoted to our paper. As requested by the Editor-in-Chief, we provide below a detailed point-by-point response to your comments.

RESPONSE TO REVIEWER 3

Reviewer 3：

Comments and Suggestions for Authors:

Authors’ reply:

Thank you very much for your care in reading our paper. Your appreciation encourages us a lot.

Author Response File: Author Response.pdf

Round 2

Reviewer 1 Report

Comments and Suggestions for Authors

Dear Authors,

Thank you for the updated manuscript. I think it can be published at the Sustainability journal.

All the best