Governance Trends among New EU Member States: Is There Institutional Convergence?

Reviewer’s remarks/comments

Actions taken

General comment

Although the topic is interesting and the paper is clear and generally well-written, I believe that the modest contribution to the literature and the excessive simplicity of the work do not deserve publication.

1. The paper lacks a solid motivation and contribution in Section 1. Regarding the contribution, the authors state, and just before the conclusions, that “As the main contribution of our paper is in introducing the VoC approach into the discussion”, certainly poor for a journal article.

Considering the comments of other reviewers, major changes have been made in the paper:

·         The abstract is re-structured in order to encompass all the main elements:  1) Background: Place the question addressed in a broad context and highlight the purpose of the study; 2) Methods; 3) Results: Summarize the article's main findings; and 4) Conclusion: Indicate the main conclusions or interpretations.

·         Significant changes have been made in the introductory chapter. We added references and clearly stated research objectives and additional information about the research is included, in terms of motivation and aim. We also added a triple contribution of the paper.

·         A few sentences have been moved from Chapter 5 to the Disscussion section. Discussion section has been re-written in order to grasp the mentioned remarks.

·         Finally, all changes can be seen through track changes.

2.       The manuscript only contains simple convergence analysis, sigma and unconditional beta convergence, without delving into the causes or implications of the results.

1. The paper completely ignores a vast literature on convergence in the public sector, both on the expenditure and tax side, to better contextualize the manuscript.

Reviewer’s remarks/comments

Actions taken

Overall, the paper “Governance Trends among New EU Member States: Is there Institutional Convergence?” is well written and an interesting read. Moreover, it is clearly indicated that this paper is an updated and extended version of a conference paper which has been published at SSRN. Thus, I guess that there are no copyright issues.

The structure of the paper should be reconsidered. Currently, the paper tries to “tell a story” instead of answering a research question. For instance, no precise research question is formulated, a Materials and Methods and Results section is missing. The “Materials and Methods” should describe the data set, the VoC classification of EU member states, the concept of beta and sigma convergence and the regression analysis. I think that the paper could benefit from restructuring its content.

1.       Abstract. The abstract needs to be improved in structure and content. It should follow the sequence of background, objectives, methods, results, implications.

Corrected.

The abstract is re-structured in order to encompass all the main elements:  1) Background: Place the question addressed in a broad context and highlight the purpose of the study; 2) Methods; 3) Results: Summarize the article's main findings; and 4) Conclusion: Indicate the main conclusions or interpretations.

2.       Introduction:

Please add references to the introduction. Currently, there are none. There are many claims made without any references.

Clearly stated research objectives or research questions are missing. The value added of the paper relative to the state of the art should be indicated. What does the paper contribute to the literature?

Significant changes have been made in the introductory chapter. According to the reviewer's recommendation, we added references and clearly stated research objectives and additional information about the research is included, in terms of motivation and aim. We also added a triple contribution of the paper.

3.       Section 2

L48f. “...(Hall and Sockice 2001)...” References should be in line with the journal style, that is numbers. However, whenever a reference is a subject or object of a sentence, the names of the authors should be mentioned followed by the reference number.

L55: References are missing.

L60-62: References are missing.

L102: “...by market relations…” do you mean “...competitive market relations..”? 

L108: “...view institutions as passive followers of rules.” What is the meaning of institution here? This conflicts with North’s view on institutions.

Thanks for the comment. Since the journal Sustainability now accepts free format submission, we will edit the references at a later stage of the article publication process (i. e. once the article is accepted).

Corrected.

Corrected.

Corrected.

Not necessarily. For more elaboration on that, please see Table 1. Conceptual categories of institutions based on their origin, emergence in particular.

Corrected (the concept of Beta convergence is thoroughly explained and the reference Barro and Sala-i-Martin (1992) has been added).

In line with the other comment regarding this Figure, the figure has been deleted, since it shows something that has been proven many times in the literature by now.

Corrected throughout the text

Corrected. This is Figure 1 now.

Corrected. This is Figure 2 now.

Corrected. This is Figure 3 now.

All data used is publicly available, and we have provided their links.

Reviewer’s remarks/comments

Actions taken

This paper explores the institutional convergence of Central and Eastern European countries using the Varieties of Capitalism (VoC) approach. Use of this approach is presented as a novel one and, from a wider perspective, this article may contribute to shed light on institutional convergence of European countries. There are, however, many (relevant) points that need to be clarified or further developed in the article, in order to improve the illustration and discussion of this research, as well as quality of the manuscript.

1.       Sec. 1 (Introduction):

As it stands, there is too little information here about the research, in terms of its motivation and aim. This lack of information has a negative impact on what follows too (especially on Sec. 2, which is therefore too weakly connected to the introductory section). The focus of this article – its research questions – are not clearly illustrated and stated at the beginning of the manuscript. Hence, I think this section should be re-written.

In addition, but on a minor level, around lines 32-33 (Sec. 1) the reader is expected to have some knowledge of “the second ‘convergence push’”. I think clarification and references to such (first and second) push(es) should be provided to improve the quality of this part of the paper. Furthermore, references to the major contributions in the literature (e.g., works by Kornai, Rodrik, Roland) would be helpful here (as well as in the following sections).

Corrected. We have re-written the introduction – all updated and additional clarifications, along with paper contribution and research objective are seen within Track changes.

Corrected. We added Kornai (1990).

2.       Sec. 2:

At the beginning of this section, the authors mention “selected inputs from the Varieties of Capitalism (VoC) approach”: I wonder what the selection process was like with regard to this study. This should be clarified. Later on, the authors refer to “building blocks” and provide two examples, namely, corporate governance and industrial relations; however, I think that additional examples, closer to the research topic, would be helpful.

The authors illustrate few basic elements of the VoC approach, and little is said about alternative or more traditional approaches that have been used in the literature to study convergence. For those who are not familiar with the VoC approach, the quite rich criticism of VoC (lines 77 ff.) is not very useful, unless a better presentation of the VoC, including its peculiarities compared to other relevant approaches, is given ahead (cf. penultimate paragraph).

Footnote 3 - I could not see footnotes 1 and 2, so the manuscript seems to need re-numbering of all its footnotes.

The various models (Mediterranean, etc.) are presented in Sec. 4.1, Table 2 (p. 8); therefore, the reader does not know what countries are included yet. Also, I wonder if the “Scandinavian model” (line 121) is the same as the Nordic one (in Table 2).

On a similar note, I could find CEE, CEEC, CEE11 along the manuscript and this was somewhat confusing. Please check use of those acronyms and, in case they are used for different groupings of countries, clarify.

Footnote 4 - please add reference(s) to North’s work.

Thank you for this observation. We have elaborated on that issue throughout the text as well as compared the findings with similar studies (i. e. studies using similar approach).

Corrected.

Corrected (The paper states which countries include the Scandinavian and Mediterranean models).

The paper examines all the abbreviations CEE and CEEC, and is corrected and included in the text as follows: CEE countries or CEECs. As for CEE11, which he states in his research ... it has been added in parentheses which countries are in question.

In the revised manuscript, that footnote is No 2. A reference to North’s work has been added.

3.       Sec. 3:

This section is a bit too long and parts of it, especially those parts about empirical findings presented in the literature, might be used to build on, and improve, the “Discussion”, which, on the contrary, is somewhat unsatisfactory as it tends to be a further short illustration of results in the figures – taking a closer look at results (see comments below, Sec. 6).

What is meant by “analysis of sigma convergence and beta convergence” (or divergence) is given from granted, but this should be explained in due course in the manuscript (or, at least, suggest an intuition for the technical concept). There is some information further on, in Sec. 4.2; however, it of little help there. See also line 282 “the sigma and unconditional convergence” which might need to be clarified. The abstract might need a bit of further clarification about this too.

Footnote 5 - usefulness of the bit between square brackets [ ] is not clear to me. Also, what is meant by the acronym NIE? Or should it be IEN?

Line 151: Boettke, Coyne and Leeson (2008) can be written as Boettke et al. (2008) (cf. line 168)

This is a helpful comment. In accordance with the reviewer’s suggestion, a few sentences have been moved from Chapter 5 to the Disscussion section. Discussion section has been re-written in order to grasp the mentioned remarks.

Corrected.

Corrected (The square bracket is deleted and the abbreviation is written with the full name).

Corrected.

4.       Sec. 4:

Sec. 4.1, figure 1 - I think this figure is not very useful, as it plots GDP and (indicators of) quality of institutions, with no separation among indicators for individual countries (whereas I expect GDP per capita, on the y axis, is referred to individual countries). Moreover, the period ranges 2002-2019: it is not clear how the figure takes this dynamic aspect into account. Perhaps a table with data used by authors to carry out their “calculations” and create this figure should be provided.

Line 300 - “Scheme 2021. Scheme 2021.” Please check this.

Sec. 4.1., figure 3 - What is represented on the y axis is not clearly stated. In addition, WGI data is mentioned and used earlier; so why do the authors add “[accessed July 2021]” here? I think this bit between square brackets should be deleted.

Lines 345 ff. - It would be better to list the six dimensions contained in WGI according to the order chosen for panels a)-f) in figure 4; also, the abbreviations/acronyms chosen (e.g., GE, RoL) might be provided here (instead of using a note below the figure). Please check use of PS and PSAV.

Lines 367 ff. - The authors write: “We test the convergence for an average of all 6 … control of corruption (CoC)”. Please justify the selection of a group of dimensions only.

Line 383 – Perhaps it should be Government Effectiveness (as this is one of the dimensions analyzed).

Lines around 384 - Please check whether RQ should be explicitly mentioned and commented here, along with other dimensions.

In providing quick comments to the results presented in the figures, the authors mention some other results/papers in the literature. I think this should be further expanded and I will return on this point in my following comments.

We thank the reviewer for this plausible comment. We discussed your proposal and decided to remove the chart, and only the highlight the fact that the correlation between institutional quality and economic growth and development has been extensively analysed and empirically confirmed in the literature.

Corrected.

Deleted “[accessed July 2021]”.

Y-axis clarified.

The square bracket is deleted.

Corrected.

Thank you for the comment. RQ dimension is interpreted, as we overlooked this before.

Corrected, the interpretation of our results and the comparison with these previous research papers was transferred in the Discussion section.

5.       First of all, please check section numbers.

In my opinion, the final section(s) need re-writing, and perhaps discussion and conclusions should be in two separate sections.

As I mentioned above, the discussion around author’s results is somewhat unsatisfactory and this part of the paper should be expanded and enriched to provide a better discussion. One way to do this may be to build on what is presented in Sec. 2 and 3 about the VoC approach, in order to further illustrate the merits of this specific VoC approach with regard to the results of this research. A rich and thorough discussion around the results of the VoC approach is expected. Moreover, and to add an example, the phrase in lines 415-417 (“This can be partly …”) should be discussed to some extent, especially with regard to the role of informal institutions.

Limitations of such convergence analysis, based on WGI using six dimensions, should be fully discussed. There is some information about possible limitations at the end of the paper, but I think that raising those methodological issues in the last paragraph of the manuscript is too late. Similarly, the second to last paragraph turns to a number of crucial issues. I think that, at the end of the paper, the reader expects conclusions rather than doubts and issues. I suggest that this penultimate paragraph (lines 423-436) is either delated or fully reconsidered. One way to improve this piece of the paper might be to move discussion of the various issues raised there in the previous section(s) of the paper.

I suggest to add a few closing lines, highlighting the key contribution of this research based on the VoC approach.

Separated. Re-written

The interpretation of our results and the comparison with the previous research papers was transferred in the Discussion section. Discussion now also dwells on the methodological issues, and recommendations for further research.

Reviewer’s remarks/comments

Actions taken

Despite the negative review, we thank the reviewer for time invested in reading the paper.

Reviewer’s remarks/comments

Actions taken

The revised version of this manuscript shows significant improvement which helps clarify many aspects of this research. In the introductory section, however, a couple of matters should still be clarified. Also, many editorial corrections need to be made, and I will list below some of those spotted while reading the manuscript.

1.       In the introduction, the authors should clarify those:

In the second paragraph, what period covers "the first decade" (line 395): later on, they refer to years from 1996 to 2019, but this is in line 404.

Lines 398-401 are about the purpose of the paper, but the issue of convergence is not adequately presented. Specifically, I think those lines are too general: a deeper presentation of the author's research question about convergence should be provided.

Lines 404-406 are not clear and there seems to be a sort of gap after "from 1996 to 2019. calculated the coefficient..." -- please correct.

At the end of this paragraph, the authors might add Barro et al. (1992) in order to provide a reference to literature on convergence parameters (and/or to other studies using those parameters).

Finally, in the revised version, it seems to me that the authors do not clarify what/when "the second 'convergence'" was/happened (see lines around Kornai, 1990).

Due to confusion, we reformulated this sentence in order to minimize the general statement relating to the period of first decade with the exact time period that we used in the analysis.

Corrected. We specified the issue of convergence in more details.

Lines 404-406 deleted, we agree they are not clear. The same thing is better explained later on in the same paragraph when describing the two EU groups from this aspect.

Annual intervals started in 2002.

From 1996-2002 interval was biannual

Corrected

2.       Minor corrections:

References between ( ) are not provided using the same style always.

abstract, line 17: delete "first"

introduction, 4th par.: Hall and Soskice, 2001 is mentioned three times (I think the second can be deleted - line 701)

footnote 4: (North, 1991)

section 4.1, 1st par.: GDP.

section 4.2, 2nd par.: periods,

Figure 4 should be Figure 3

discussion: I suggest "Specifically, Alesina et al. (2017, 4)..." as the three names are already mentioned above

conclusion: please check "old" and 'new'

Corrected

Corrected

Corrected.

Corrected

Corrected

Corrected

Corrected

Corrected

Corrected