Financial-Economic Analysis of Cultural Companies in Small and Medium-Sized Cities in Spain

Round 1

Reviewer 1 Report

This is a well-done article on a topic of interest and it is my pleasure to review it. The paper is clear and well balanced, but nonetheless relevant for practitioners, policy-makers and scholars. Moreover, the findings could be useful for other countries and entities involved cultural sectors. Methodology and approaches are interesting, systematic and comprehensive.

The paper has merits; however, I suggest several recommendations:

• The paper is quite long and complex, with detailed analysis. Although the effort is worthwhile, and the results are interesting and useful, the size and the various sub-objectives test the reader's interest and patience.
• The authors should also consider (even highlight) the link with sustainability, which is not very visible, although it is indirectly suggested.
• What is the fundamental objective of the paper, what is wanted from these analyses and comparisons - between different types of companies?, from the same (cultural) sector?, by types of localities?, compared to a specific benchmark?
• The literature on this topic seems to be treated rather quickly and partially. From our point of view, this fact does not facilitate either the precise establishment of the objectives and working hypotheses (in the first part of the paper) nor the integration of the present findings in the international flow of research on this topic (in Conclusions).
• Mentioning the limits of research and suggesting in-depth topics for future research, as an invitation to an academic debate, would improve the value of the paper.

 Minor formal corrections.

Author Response

The authors are grateful for the positive evaluation of our work. Regarding the recommendations made, our responses are as follow:

1. Indicated by the reviewer: “The authors should also consider (even highlight) the link with sustainability, which is not very visible, although it is indirectly suggested”.

Underlining the link with sustainability seems to us a very useful suggestion, although it was not an initial objective of this work. In future research, the aspect of sustainability will be taken into account to the extent that data is available, for both the territorial and business components.

2. Indicated by the reviewer: “What is the fundamental objective of the paper, what is wanted from these analyses and comparisons - between different types of companies? from the same (cultural) sector? by types of localities? compared to a specific benchmark?”.

We must apologize for having tested your patience and interest as a reader. We will consider these comments for future works; in the present case, we have sought to reorganize the section on the paper’s objectives (Lines 77-91). Thus we have deepened the chief object of the work, this being essentially to study and interpret the relationships between territory, productive sector, and company from a microeconomic perspective (financial operation of the company). In our work, this relationship materializes in small and medium-sized cities (metropolitan and non-metropolitan), the cultural sector (traditional cultural activities), and the financial economic structure of the firm.

3. Indicated by the reviewer: “The literature on this topic seems to be treated rather quickly and partially. From our point of view, this fact does not facilitate either the precise establishment of the objectives and working hypotheses (in the first part of the paper) nor the integration of the present findings in the international flow of research on this topic (in Conclusions)”.

We must note that the bibliography dealing simultaneously with economic and financial analysis of cultural companies and with the territorial component (small and medium-sized, metropolitan and non-metropolitan cities) is very limited. Most of the existing bibliography refers either to financial economic analysis, in some cases linked to the cultural sector, or simply to the cultural sector. Even the best of these cases consider the territorial perspective but not the company.

4. Indicated by the reviewer: “Mentioning the limits of research and suggesting in-depth topics for future research, as an invitation to an academic debate, would improve the value of the paper”.

Some of the limits of the methodological design are expressed in the Conclusions section (Lines 659-662), and these are also shown to underlie the future research proposal (Lines 686-690), as variables measuring the governance structure of these cities have not been integrated into the analysis. The company is one more actor in this territorial system where the various actors make investment decisions and maintain relations of cooperation and competition. One suggestion for future debate, from a territorial approach (territory defined as an agent of social transformation): myths and reality of the so-called cultural and creative industries as an engine of sustainable development processes.

Reviewer 2 Report

I enjoyed reading this paper. This is interesting research. However, I think the following points need to be addressed in the article.

 

1. According to paragraph 4 of page 5 (line 202-214), this analysis used the SABI, covering 3 million Spanish and Portuguese companies. However, it was not clear the SABI covered how much percentage of actual companies. Without this information, it is difficult to know whether there is bias in the data or not. 
2. According to Figure 1 (number of employment), most firms seem to be small or micro firms. However, Table 3 suggests that there are many medium and large firms. Why? It is also better to mention what vertical axes are. It is more readable.
3. According to Table 3, the sizes of firms are very different. The economic impacts and the operation of large businesses and microbusinesses are much different. It seems necessary to disentangle the analysis depending on the size of the firms.
4. It would be better to write what vertical axes are. It is not clear how significant these differences are. The vertical scale on the table may be too small. If the scale is a little larger, it will be almost a horizontal straight line. Therefore, it is not clear whether the difference between each item is meaningful.
5. Figures 3a and 3b are too small, and I have difficulty reading it. 
6. Regarding Figures 3a and 3b, I am unsure if it is meaningful to compare marginal means. The vertical scale on the table may be too small. The impression from the figure is that there is a significant difference among factors. As the actual value difference is minimal, I have difficulty interpreting these results. Why do authors regress on these numbers? It is much easier to know the influence and present the results.
7. It is not clear from the abstract what the findings are. The abstract mentions that "The results of the applied method indicate heterogeneity in the financial situation of these cultural industries in the activities and cities analysed." This summary is too broad. The same to the conclusion (lines 670-686). Suppose there are differences, as the paper claimed. It would be better to mention what these differences mean or how we should interpret those results.

Author Response

Please see the attachment (Reviewer 2)

Author Response File: Author Response.pdf

Reviewer 3 Report

Authors examine "Financial-economic analysis of cultural companies in small and medium-sized cities in Spain" seems to be an interesting work and the authors report that heterogeneity in the financial situations of these cultural industries in the activities and cities. the work needs to address the following major flaws:

1. The abstract need to clearly define the cultural companies, the aim of the work method, and important findings and policy suggestions
2. the literature part is very weak authors fail to develop their research questions and objectives, and further unable to link their hypothesis mentioned in the section 3. Data, methodology and hypotheses. there has been a lack of flow and linkages of the literature and support for theoretical underpinning missing.
3. Since authors deal with cultural cities and companies, need to build a longitudinal dataset and present their empirical model accordingly. the present way of data, material, and method is not robust to explore the stated research proposal.
4. there is a lack of economic discussion of the results
5. the conclusion section needs to be presented with the main findings, managerial and policy implications

Author Response

Please see the attachment (Reviewer 3)

Author Response File: Author Response.pdf

Reviewer 4 Report

I highly appreciate the article for:
- an interesting and rarely undertaken subject of financial-economic analysis of cultural companies depending on the size of the local government unit in which these companies operate;
- clearly defined purpose, subject, scope of research and their substantive justification;
- carefully selected variables explaining the economic and financial situation;
- the variety and correctness of the methods used;
- depth of analysis and conclusions.

To improve the quality and readability of the article, I suggest:
- improving the quality of charts, especially in lines 592 and 599, and standardizing the font and its size.

I wish you further successful analyzes and interesting conclusions for the theory and practice of the analyzed companies.

Author Response

Please see the attachment (Reviewer 4)

Author Response File: Author Response.pdf

Round 2

Reviewer 2 Report

I think this article is ready to publish.

 

Reviewer 3 Report

Authors have now improved  the work