Development Growth and Finance of

Organizations from an Eastern

European Context The 2015 Griffiths
School of Management Annual
Conference on Business
Entrepreneurship and Ethics GSMAC
1st Edition Sebastian Vaduva
Visit to download the full and correct content document:
https://textbookfull.com/product/development-growth-and-finance-of-organizations-fro
m-an-eastern-european-context-the-2015-griffiths-school-of-management-annual-con
ference-on-business-entrepreneurship-and-ethics-gsmac-1st-edition-se/
More products digital (pdf, epub, mobi) instant
download maybe you interests ...

Business Ethics and Leadership from an Eastern European

Transdisciplinary Context The 2014 Griffiths School of
Management Annual Conference on Business
Entrepreneurship and Ethics 1st Edition Sebastian
Vaduva
https://textbookfull.com/product/business-ethics-and-leadership-
from-an-eastern-european-transdisciplinary-context-
the-2014-griffiths-school-of-management-annual-conference-on-
business-entrepreneurship-and-ethics-1st-edition-sebastia/

Challenges and Opportunities to Develop Organizations

Through Creativity, Technology and Ethics: The 2019
Griffiths School of Management Annual Conference on
Business, Entrepreneurship and Ethics (GSMAC) Silvia L.
Fotea
https://textbookfull.com/product/challenges-and-opportunities-to-
develop-organizations-through-creativity-technology-and-ethics-
the-2019-griffiths-school-of-management-annual-conference-on-
business-entrepreneurship-and-ethics-gsm/

Entrepreneurship and Management in an Islamic Context

1st Edition Veland Ramadani

https://textbookfull.com/product/entrepreneurship-and-management-
in-an-islamic-context-1st-edition-veland-ramadani/

New Trends in Finance and Accounting : Proceedings of

the 17th Annual Conference on Finance and Accounting
1st Edition David Procházka (Eds.)

https://textbookfull.com/product/new-trends-in-finance-and-
accounting-proceedings-of-the-17th-annual-conference-on-finance-
and-accounting-1st-edition-david-prochazka-eds/
Country Experiences in Economic Development Management
and Entrepreneurship Proceedings of the 17th Eurasia
Business and Economics Society Conference 1st Edition
Mehmet Huseyin Bilgin
https://textbookfull.com/product/country-experiences-in-economic-
development-management-and-entrepreneurship-proceedings-of-
the-17th-eurasia-business-and-economics-society-conference-1st-
edition-mehmet-huseyin-bilgin/

Global Versus Local Perspectives on Finance and

Accounting: 19th Annual Conference on Finance and
Accounting (ACFA 2018) David Procházka

https://textbookfull.com/product/global-versus-local-
perspectives-on-finance-and-accounting-19th-annual-conference-on-
finance-and-accounting-acfa-2018-david-prochazka/

Dynamic Behavior of Materials, Volume 1: Proceedings of

the 2015 Annual Conference on Experimental and Applied
Mechanics 1st Edition Bo Song

https://textbookfull.com/product/dynamic-behavior-of-materials-
volume-1-proceedings-of-the-2015-annual-conference-on-
experimental-and-applied-mechanics-1st-edition-bo-song/

Experimental and Applied Mechanics, Volume 4:

Proceedings of the 2015 Annual Conference on
Experimental and Applied Mechanics 1st Edition Cesar
Sciammarella
https://textbookfull.com/product/experimental-and-applied-
mechanics-volume-4-proceedings-of-the-2015-annual-conference-on-
experimental-and-applied-mechanics-1st-edition-cesar-
sciammarella/

Proceedings of the 2015 Federated Conference on

Software Development and Object Technologies 1st
Edition Jan Janech

https://textbookfull.com/product/proceedings-of-
the-2015-federated-conference-on-software-development-and-object-
technologies-1st-edition-jan-janech/
Sebastian Vaduva · Ioan S. Fotea
Andrew R. Thomas Editors

Development, Growth
and Finance of
Organizations from
an Eastern European
Context
The 2015 Griffiths School of
Management Annual Conference on
Business, Entrepreneurship and Ethics
(GSMAC)
Development, Growth and Finance
of Organizations from an Eastern European Context
Sebastian Vaduva • Ioan S. Fotea
Andrew R. Thomas
Editors

Development, Growth
and Finance of Organizations
from an Eastern European
Context
The 2015 Griffiths School of Management
Annual Conference on Business,
Entrepreneurship and Ethics (GSMAC)
Editors
Sebastian Vaduva Ioan S. Fotea
Griffiths School of Management Griffiths School of Management
Emanuel University of Oradea Emanuel University of Oradea
Oradea, Romania Oradea, Romania

Andrew R. Thomas
College of Business Administration
University of Akron
Akron, OH, USA

ISBN 978-3-319-54453-3    ISBN 978-3-319-54454-0 (eBook)

DOI 10.1007/978-3-319-54454-0

Library of Congress Control Number: 2017933451

© Springer International Publishing AG 2017

This work is subject to copyright. All rights are reserved by the Publisher, whether the whole or part of
the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation,
broadcasting, reproduction on microfilms or in any other physical way, and transmission or information
storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology
now known or hereafter developed.
The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication
does not imply, even in the absence of a specific statement, that such names are exempt from the relevant
protective laws and regulations and therefore free for general use.
The publisher, the authors and the editors are safe to assume that the advice and information in this book
are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the
editors give a warranty, express or implied, with respect to the material contained herein or for any errors
or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims
in published maps and institutional affiliations.

Printed on acid-free paper

This Springer imprint is published by Springer Nature

The registered company is Springer International Publishing AG
The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland
Preface

The papers in this book were discussed and disseminated at the 6th annual Griffiths
School of Management International Conference on Business and Ethics, organized
by Emanuel University of Oradea during May 2015. The conference provided a
platform for academics and practitioners in the fields of business and leadership to
interact and debate on the different dimensions of ethics in business and leadership
in the context of developing, growing, and financing Romanian organizations, both
public and private.
Country Benchmarking for Setting Up a New Business focuses on the relation-
ship between the entrepreneurial task of starting a new business and the main factors
that can expedite or delay this process. The author takes into account the number of
procedures, the time, and the financial aspects that are required to start a business.
This research aims to support the development of the business sector and to benefit
future entrepreneurs.
Excessive bureaucracy and corruption that have led to a negative image regard-
ing public administration have plagued Romania and its civil servants. In this con-
text, The Image of Local Public Administrations in Transylvania Among Citizens – An
Empirical Study aims to identify the main concerns of public authorities in relation
to its citizens and to offer some solutions for the future.
The paper Entrepreneurial Myopia and Succession-Based Crises in Family
Business – A Strategic Options Perspective studies the phenomenon of entrepre-
neurial myopia in the context of business successions within family firms. The
authors analyze the challenges during the succession process and seek to provide
some real option thinking that would help avoid the lack of entrepreneurial direction
and action. The research offers a series of 11 propositions that aim to adjust the
shortsightedness that occurs in family business successions.
The author of The Development of Medical Business Through Relational
Marketing analyzes the shift in paradigm regarding the medical business in Romania
that has significantly grown and is now a domain of relentless competition. In this
medical landscape, the research seeks to define the “client-patient” concept and to
identify the potential medical services that would aid in winning the loyalty of the
consumer.

v
vi Preface

Customer satisfaction is a very pertinent subject to any business owner and entre-
preneur, as the research Customer Satisfaction in IT Professional Services illus-
trates. The author shows the direct correlation between customer satisfaction and
loyalty toward a company, this also having a financial implication due to the fact
that attracting new customers is more costly than retaining them. The research tests
the compatibility between customer satisfaction and financial performance and also
the correlation between employee satisfaction and customer satisfaction.
The New Phase Transition of the World Economy investigates the evolution of
world economy through a transdisciplinary lens that can assist in better understand-
ing the current economic trends and their impact. The paper also emphasizes the
role of capitalism in the transition toward new economic structures.
In a fast-paced world that continually changes and innovates, the task of manag-
ers, trying to keep a balance between exact activities and creative ones, seems daunt-
ing. The authors of the article Managerial Creativity, Between Native Enhancing
Factors and Environmental Influencers argue that the key for remaining relevant and
competitive in the business landscapes is the ability to develop and implement cre-
ative ideas and concepts. The research shows the importance of both external and
internal factors in developing creativity and also the value of a good organizational
culture. The observations on creativity presented in this paper aspire to help manag-
ers in their quest to develop a more creative outlook on managerial work.
Given that most entrepreneurs are known risk takers and are prone to living in the
present, the ability to make decisions based on foreseeing circumstances is a great
tool for long-term entrepreneurial success. In view of this, The Absence of
Entrepreneurial Foresight as a Reason of Entrepreneurial Failure is, as the author
explains, a great first step toward determining the necessary skills that entrepreneurs
must strive to achieve foresight-oriented attitude. Many start-ups fail due to the lack
of foresight for their enterprise, and this could be avoided by being aware of both
present and future dangers.
Mergers and acquisitions are known to come in waves, and, until today, we have
perceived five such waves, out of which the fifth is the most remarkable. The study
Merger and Acquisition Activity During the Fifth Wave: USA vs. EU illustrates this
topic though a comparative study between the USA and the EU. The author describes
the European Union as becoming a serious competitor on the international market,
while the USA is exemplary regarding the large volume of mergers and
acquisitions.
The link between the ability to make qualitative decisions and hereditary tenden-
cies has long been subject to numerous theories and speculations. The authors of
Managerial Fractal Intelligences. Psychometric Evidence for Empowering the
Theory of Multiple Intelligences bring to light the conclusions of a known Romanian
psychometric technologies inventor, Dumitru Grigore, in the sphere of multiple
intelligences.
Shadow economy refers to any legal production of goods and services that is
deliberately concealed from public authorities for diverse reasons. The paper What
Are the Main Determinants of the Romanian Shadow Economy? An Empirical
Analysis Based on Structural Equation Models gives insight on this topic, with a
Preface vii

case study on Romania. The author notes that when the “official” economy recov-
ers, the incentives for working in a shadow economy decrease.
The Capabilities of Romanian Universities to Attract EU Funds: A Case Study
illustrates the administrative potential that Romanian universities have in attracting
available EU funds that would enable the growth and expansion of the academic
endeavor. The authors analyze a sample of Romanian universities to determine the
effectiveness of implementing EU funds and determinants of competent university
management.
We trust that you will find this useful.

Oradea, Romania Sebastian Vaduva

Oradea, Romania Ioan S. Fotea
Akron, OH, USA Andrew R. Thomas
Contents

1 Country Benchmarking for Setting Up a New Business...................... 1

Bianca Avram and Stelian Brad
2 The Image of Local Public Administrations
in Transylvania Among Citizens: An Empirical Study........................ 15
Dan-Cristian Dabija, Ciprian-Marcel Pop, and Raluca Băbut‚
3 Entrepreneurial Myopia and Succession-Based Crises
in Family Businesses: A Strategic Options Perspective........................ 41
Silvia Fotea, Jörg Freiling, and Daniel Neagoie
4 The Development of Medical Business Through
Relational Marketing............................................................................... 67
Beniamin Grozea and Nicolae Al Pop
5 Customer Satisfaction in IT Professional Services Research............... 75
Mircea Motogna
6 The New Phase Transition of the World Economy............................... 101
Igor Prisac
7 Managerial Creativity Between Native Enhancing Factors
and Environmental Influencers.............................................................. 115
Mihai Florin Talpos, Dan Oncica-Sanislav, and Dumitru Grigore
8 The Absence of Entrepreneurial Foresight as a Reason
of Entrepreneurial Failure...................................................................... 127
Wolfgang Schenk
9 Merger and Acquisition Activity During the Fifth Wave:
USA vs. EU............................................................................................... 133
Mariana Sehleanu

ix
x Contents

10 Managerial Fractal Intelligences: Psychometric Evidence

for Empowering the Theory of Multiple Intelligences......................... 145
Dumitru Grigore, Mihai Florin Talpos, and Ioan G. Pop
11 What Are the Main Determinants of the Romanian
Shadow Economy? An Empirical Analysis Based
on Structural Equation Models.............................................................. 159
Adriana Anamaria Davidescu
12 The Capabilities of Romanian Universities to Attract
EU Funds: A Case Study......................................................................... 171
Ion Stegarou, Cristian Marinas, Ionut Florin Bratiloveanu,
and Adrian Irimia
Chapter 1
Country Benchmarking for Setting
Up a New Business

Bianca Avram and Stelian Brad

Abstract The analysis of the form in which a business is founded is highly

­important for the economic development of a country and the regulation of the
administrative sector can improve economic performances. This paper is intended
to address the study of the manner in which the social and economic development
indicators affect the number of procedures and time required to start a business and
also the financial aspect that characterizes this entrepreneurial activity. In order to
carry out this analysis, we have constructed a sample, which includes 125 countries
pertaining to all continents for which we have recorded, besides the three variables,
the values for the social and economic development indicators. We have completed
our analysis through the graphical representations of the variables that define the
administrative framework as a function of the social progress index, respectively,
GDP/capita. Consequently, after constructing these graphs and computing the cor-
relation coefficient, we have discovered reverse connections between all combina-
tions of the variables that are subject to our study. The results obtained have
implications in the development of the business sector and aid the legal mechanisms
to implement regulations and norms aimed to facilitate the access of future entrepre-
neurs to the business environment.

Keywords Start-up • Social progress index • GDP • Procedures • Starting a

business

1.1 Introduction

The process of conducting a business and the results such an action generates are the
two most widely known meanings attributed to the entrepreneurship term. Out of
the two meanings, researchers have focused their attention on the first one – the
process of conducting business (Verstraete and Jouison-Laffitte 2011). The entre-
preneurial spirit can be expressed through the establishment of various types of

B. Avram, PhD (*) • S. Brad

Technical University of Cluj-Napoca, Cluj-Napoca, Romania
e-mail: avrambianca@mail.utcluj.ro; stelian.brad@staff.utcluj.ro

© Springer International Publishing AG 2017 1

S. Vaduva et al. (eds.), Development, Growth and Finance of Organizations
from an Eastern European Context, DOI 10.1007/978-3-319-54454-0_1
2 B. Avram and S. Brad

organizations, among which are the following: businesses, branches, political

­parties, and nongovernmental organizations (Verstraete and Jouison-Laffitte 2011).
Based on the research question “Does the social/economic health of a country
impact the conditions necessary for starting a new business within that country?”
the foremost objective of this paper is to study the entrepreneurial phenomenon
from the administrative perspective of the business opening process. We aim to
achieve this by establishing and describing the influence exerted by the social and
economic development indicators on the number of procedures, time, and costs
implied by the process of opening a new business (Djankov et al. 2002).
Statistical data recorded by different international organizations (World Bank,
Eurostat, Doing Business, etc.) suggests that there are significant dissimilarities in
the way that countries regulate the founding of a new business. For instance, in
2014, to open a new business in Germany, one had to go through nine different
procedures that lasted 14.5 days and required an amount of money equal to 44.6%
of national income/capita. In Canada, for the same operation, the future entrepre-
neur only had to comply with a single procedure, wait for 5 days, and spend an
amount of money equal to 0.4% of the national income/capita in their country
(Doing Business, Doing Business 2015 Going Beyond Efficiency, 2014).

1.2 Theoretical Background

The strong negative correlation between the number of procedures, time, and cost
pertaining to the act of establishing a new business and the total number of newly
opened businesses, which implies the same connection between the administrative
framework and economic growth, is different depending on the economy (Klapper
et al. 2007). An eloquent example that illustrates this strong link is Mexico, in which
the administrative reform led to the reduction of procedures by approximately 60%,
which, in turn, generated a 5% growth of the total number of companies and a 24%
expansion of newly registered businesses in Guadalajara (Bruhn 2011). Although,
in the case of Mexico, these favorable results were obtained by significantly reduc-
ing the number of procedures, notable effects have been noticed even when this type
of procedures are lowered by only 20% (Klapper and Love 2010).
Similar to the issue of the amount of time required opening an enterprise, the
amount of money to be spent by the coming entrepreneur for this purpose is in a
reverse relationship with the total number of newly opened businesses (Klapper
et al. 2007). Klapper et al. (2007) offer an example to support this claim: if costs
were reduced by 10% in the countries in which the total costs borne by the founder
of the new enterprise surpass 40% of the national income/capita, then the growth
rate of the total number of newly established businesses would be equal to 1%.
Furthermore, this connection can also be analyzed in an opposing way through
the influence that the economic and social development indicators exert on the num-
ber of procedures and days and the cost of founding a new company. Djankov et al.
(2003) researched countries in which the regulation of the business sector has led to
1 Country Benchmarking for Setting Up a New Business 3

its encumbrance as corrupt and poor. The result of this research has been the basis
of new legislations, which aim to encourage the establishment of new enterprises.
Between 1999 and 2006, various countries have adopted new laws that favor the
business sector: France has reduced the number of days required to open a business
from 53 to 8 days, while Italy has reduced it from 62 to just 13 days during the same
period of time (van Stel et al. 2007). In the 107 states which have been analyzed by
the World Bank and Doing Business in the year 2012, an approximate number of 3.1
million limited liability companies have been established, for which, if all necessary
procedures had been followed, entrepreneurs would have spent 46.9 days only on
securing this aspect. The report conveys the hypothesis of applying the best regula-
tions for the process of establishing a new enterprise in the 107 economies pertain-
ing to the countries under analysis, which results in a significant amount of spared
precious time (more exactly, 45.4 million days), time that could be used by entrepre-
neurs to focus on the necessary activities in order to develop the newly created busi-
ness (Doing Business, Doing business in a more transparent world, 2012).
The negative correlation between the growth of GDP/capita and the administra-
tive framework of establishing a new business can be explained through the fact that
rich countries (which have a value of the GDP/capita pertaining to the top quartile)
exhibit a low degree of regulation in this area (Djankov et al. 2003).

1.3 Methodology

We have put together the database, which is the essential element of this paper, with
the help of the quantitative variables, which describe both the regulation of the
administrative sector responsible for the process of opening a new business, and the
social and economic development indicators (GDP/capita). The employed sample
consists of 125 countries from all continents, and we have collected the necessary
information to create it from official sites pertaining to the World Bank, Doing
Business (World Bank Group), and Social Progress Imperative. The constitution of
the sample based upon the collected data for the 125 countries is aimed toward cover-
ing a broader spectrum and obtaining precise results. In order to describe the admin-
istrative regulations within the countries and to understand the factors which
contribute to their establishment and readjustment, we took into account the proce-
dures, time, and cost necessary to opening a new business, the variables for which we
will provide further details. The procedures, which need to be followed so as to estab-
lish a business, consist of interactions between the future entrepreneurs and external
parties, interactions that take place in different offices. According to Doing Business,
the required procedures to found a new business also include the transactions and/or
the correspondence with official public agencies, which are responsible with the for-
mal aspects of opening a new business. If the founders of the business have been
present repeatedly at the same office but for different procedures, then these are con-
sidered as separate and not as a single procedure. It should be pointed out that indus-
try-specific procedures, those necessary in order to ensure electric and water services,
gas, and waste disposal connections, are not included in this indicator.
4 B. Avram and S. Brad

The time required to open a business is represented by the average duration of the
number of days in which the founder can carry out all the procedures mentioned
above. As a result of the assumption that the future entrepreneur is familiar with the
agencies responsible for establishing businesses, the time spent documenting and
gathering knowledge is not included. In order to follow each procedure, an interval
of 1 day is granted, except in the case of procedures that can be executed online, in
which case they are granted only half a day.
The cost which has to be borne by the coming entrepreneurs is represented by the
percentage of national income/capita and consists of the sum between the cost
which includes all official taxes and that is denoted by the sum of money which has
to be deposited into a bank account before registering the business. The sum of
money deposited into the bank account constitutes the minimum capital of the com-
pany and should not be withdrawn, usually, for at least 3 months after the enterprise
was established. While in some countries this amount of money should be entirely
placed into the bank account before the company is founded, in other countries,
only a fraction of this sum should be deposited, the rest being cleared after the first
year of activity.
The social progress index is meant to determine the degree in which a country
provides its citizens the possibility to meet social needs through a set of three differ-
ent dimensions that are characterized by the same relative importance: basic human
needs, foundations of well-being, and opportunity (Bishop 2013). Each of these
three dimensions is, in turn, computed as the sum of other four components, which
are, also, equally weighted. Therefore, in order to obtain the level of basic human
needs, the following aspects are employed: nutrition and basic medical care, water
and sanitation, shelter, and personal safety; the components of foundations of well-­
being are access to information and communications; access to basic knowledge,
health, and wellness; and ecosystem sustainability. Finally, for the opportunity ele-
ment, personal rights, personal freedom and choice, tolerance and inclusion, and
access to advanced education are invoked (Fehder and Stern 2013).
Our study seeks to identify a set of links between the social and economic devel-
opment indicators and the three variables by constructing a scatter plot between
each variable and the social and economic development indicators. Consequently,
each of these graphs is divided into four quadrants numbered in the sense of the
trigonometric circle. This division is made possible by intersecting the lines, which
pass through the mean value of each variable. It should be mentioned that the
graphs’ axes originate from the approximate minimum value registered by each
variable (which in some cases is equal to zero).

1.4 Results and Discussions

The analysis we have conducted leads to the following descriptive statistics for the
variables we have employed. The lowest number of procedures needed to establish
a business is found in Canada and New Zealand (one procedure), while the
1 Country Benchmarking for Setting Up a New Business 5

Table 1.1 Descriptive statistics for number of procedures, time, and cost
Number of procedures Time (days) Cost (% of income/capita)
Minimum 1.00 0.50 0.30
Maximum 16.00 83.60 498.60
Mean 6.55 17.05 40.31
Median 5.00 12.00 0.30/0.70
Std. deviation 3.12 15.28 80.26
Percentiles 25 4.00 6.00 3.45
50 6.00 12.00 13.90
75 8.50 22.00 41.30
Skewness 0.74 1.88 3.75
Kurtosis 0.34 3.93 15.04

maximum value of this indicator is attributed to the Philippines (16 procedures).

With a mean value of 6.55 procedures, the sample consisting of 125 countries has a
mode value of 5 procedures; this value is found in the case of 19 countries. Quartiles
split the data set into four equal parts; therefore, 25% of the countries have a number
of procedures between 1 and 4, 50% of the countries feature values of this variable
in the interval 1–6, and in 75% of the countries, the number of days required to
establish a company consists between 1 and 8.5 procedures (Table 1.1).
The distribution of the values around the mean is measured by the standard devi-
ation and has a value of 3.12. This reveals the average number of procedures by
which the number of procedures necessary to open a business deviates on average
from the average value. The positive value of the Skewness coefficient (0.74) indi-
cates a positive asymmetry and a distribution sloping to the right, as a result of the
fact that the mean is greater than the median. Furthermore, the Kurtosis coefficient
also has a positive value (0.34) which points to a “tall” distribution, a leptokurtic
one, and because the value does not exceed the interval of ±1.96, the distribution is
a normal one.
In reference to the time variable, we observed that the minimum value of only
0.5 days is registered in New Zealand, as in the case of the number of procedures,
and that the maximum value, of 83.60 days, is encountered in Brazil. With a mean
of 17.05 days; the quartile values of 6, 12, and 22 days, respectively; and the posi-
tive value of the Skewness coefficient (1.88), the data set representing the time vari-
able presents a distribution sloping to the right. The standard deviation, which is
equal to 15.28 days, shows that this variable registers values that significantly drift
away from the mean value, and the Kurtosis coefficient (3.93) indicates that the
distribution is not normal, which leads us to use the Spearman coefficient in order
to study the correlation with the social and economic development indicators.
With the necessary cost of establishing a business of only 0.30% of national
income/capita, South Africa, Ireland, the United Kingdom, and New Zealand record
the lowest level of these expenses. In contrast, Guinea registers a total cost of
498.60% of national income/capita for opening a new enterprise. A situation, which
differs from the previous variables, is that the minimum value is, at the same time,
6 B. Avram and S. Brad

the mode value. However, it should be specified that the mode is rather rare, as it
appears only in four cases, and, also, that there is another mode of 0.70% of the
national income/capita. The mean of the total cost as a percentage of the national
income/capita is equal to 40.31%, and the countries within the sample deviate on
average from the average value by 80.26%. Twenty-five percent of the countries
included in the sample have a total cost required to found a new company between
0.30 and 3.45% of national income/capita, 25% of these present a value of the vari-
able between 3.45 and 13.90% of national income/capita, 25% of the analyzed
countries apply a regulation in which future entrepreneurs have to spend between
13.90 and 41.30% of national income/capita, and the rest of 25% present a value of
the total cost situated between 41.30 and 498.60% of national income/capita.
Concerning the distribution of the variable, both the Kurtosis (15.04) and the
Skewness (3.75) coefficients indicate that the data is not normally distributed, as
well as that the distribution is sloping to the right.

1.5 Social Progress Index

In Fig. 1.1, the manner in which the scatter plot is spread reflects a uniform dividing
of the 125 countries in the four quadrants, the most favorable situation for the busi-
ness environment being present in the fourth quadrant. Quadrant I is comprised of
36 countries characterized by a value of the social progress index larger than 63.69
and that of the number of procedures to follow in order to open a business larger
than 6. The countries pertaining to quadrant I, in which the number of procedures is

18
16
II I
14
Number of Procedures

12
10
8
6
4
2
III IV
0
30 40 50 60 70 80 90
Social Progress Index
Fig. 1.1 The link between the number of necessary procedures to open a business and social pro-
gram index
1 Country Benchmarking for Setting Up a New Business 7

low and the social progress index reaches the highest values, are Germany, Japan,
and Austria, while, at the opposing pole, with a significant number of procedures
and a low level of the social progress index, we can observe the following countries:
the Philippines, Argentina, and Ecuador.
Quadrant II encompasses 19 countries, which have a social progress index below
the mean value of 63.69 and a number of procedures above 6. The most unfortunate
situation and the least favorable for the business environment can be found in Chad,
the Central African Republic, and Sudan, where the value of the social progress
index is situated below 40 and the number of procedures required to found a new
business is of 9, 8, and 10, respectively. A number of 25 countries can be found in
quadrant III, as these have a number of necessary procedures to establish a company
below 63.69. Within this quadrant, from the perspective of the procedures, the varia-
tion between countries is not substantial; the differences between these can be per-
ceived mainly due to the values of the social progress index. In order to support this
affirmation, we provide the example of Georgia, Azerbaijan, and Russia, which
record values for the social progress index that are almost double in comparison to
the values recorded in Guinea, Yemen, and Burundi, but they have approximately
the same number of procedures necessary to open a business (two, three, and six
procedures).
Quadrant IV includes the countries that exhibit the most favorable means for
starting up a business due to the above mean values of the two variables. In this
particular quadrant, one can find countries such as New Zealand, Switzerland, and
Iceland, which with a number of procedures equal to 1, 1, and 3, respectively, and
an index of social progress that registers maximum values, hold the first place in this
ranking. On the other side, the last places are attributed to countries like Peru,
Ukraine, and Armenia.
As a result of the fact that the two variables exhibit a normal distribution, we
compute the Pearson coefficient in order to identify the presence of correlation. The
value of the coefficient is equal to −0.306, and that of Sig <0.05 indicates that
between the number of procedures needed to found a new company and the social
progress index, there is a significant and reverse connection, which means that a
growth of the social progress index will lead to a reduction of the number of neces-
sary procedures to open a business. Although there is a correlation between these
variables, the value of the Pearson coefficient signals that this connection is a weak
one (Table 1.2).

Table 1.2 Correlation coefficient of the regression analysis

Procedure Time Cost
Social progress index
Correlation coefficient −0.306 (Pearson) −0.390 (Spearman) −0.470 (Spearman)
Sig. (2 – tailed) 0.001 0.000 0.000
GDP/capita
Correlation coefficient −0.271 (Spearman) −0.318 (Spearman) −0.467 (Spearman)
Sig. (2 – tailed) 0.002 0.000 0.000
8 B. Avram and S. Brad

90
80 II
I
70
60
Time (days)

50
40
30
20
10 II I IV
0
30 40 50 60 70 80 90
Social Progress Index

Fig. 1.2 The link between the number of days needed to open a business and the social progress
index

In contrast to the figure above, the dispersal of the number of days needed to
establish a business as a function of the social progress index indicates a chaotic
distribution of the scatter plot and a multitude of extreme values of the time variable
(Fig. 1.2). Similar to the case above, the most favorable environment for building a
business can be found in quadrant IV, in which the value of the social progress index
is above average and the time needed to open a business is lower than the average of
the sample. However, even within this quadrant, there are differences between the
49 countries. Therefore, New Zealand, Iceland, and the Netherlands present values,
which are more favorable to the business environment in comparison to those
recorded in Turkey, El Salvador, and Montenegro.
On the other hand, the situation is significantly different in the case of the second
quadrant because the 27 countries which are included in it register values of the
social progress index that are lower than the average and values of the time variable
that are above the sample average. Also, in the case of this quadrant as in the others,
there are countries in which the conditions in which a business can be established
are adverse (Saudi Arabia, Dominican Republic, and South Africa) in comparison to
other countries (Chad, Angola, and Sudan). The largest number of days required to
constitute a business is registered in Brazil, which is found in the first quadrant (15
countries) and where the value of the social progress index is above average while
the number of days surpasses the sample average. Besides Brazil, Ukraine, Bosnia
and Herzegovina, and Thailand are situated on the last places in this quadrant, while
countries such as Austria, Czech Republic, and Costa Rica occupy the first places.
Quadrant III includes 34 countries which record values below average for both vari-
ables, and among these countries, there are a few which stand out, Burundi, Guinea,
and Togo, for which the values for the social progress index are the lowest and
1 Country Benchmarking for Setting Up a New Business 9

Georgia, Tunisia, and Azerbaijan which, besides the fact that the values of the time
variable are below the sample average, they also have among the highest values for
the social progress index.
As a result of the two variables not having normal distributions (solely the social
progress index presents a normal distribution of the data), in order to study the cor-
relation between the social progress index and the number of days necessary to
establish a business, we compute the Spearman coefficient that registers a value of
−0.390. Knowing the value of Sig <0.05, we can observe that between the two vari-
ables, there is a significant link, but this link is reverse due to the negative value of
the Spearman coefficient. In other words, a growth in the social progress index
determines a reduction in the number of days required to open a business.
Regarding the study of the link between the necessary cost to open a business and
the social progress index, it can be noted that it presents a particularity that has not
been encountered in the previous situations: in quadrant I, in which the values for the
social progress index and those for the total cost implied by founding a business are
above the average, there are only six countries included: El Salvador, Bosnia and
Herzegovina, Kuwait, Hungary, Slovenia, and Germany (Fig. 1.3). The main cause of
this particular situation is the extreme values registered by the cost variable (five
countries have values for this variable which exceed 200%) that determine the increase
of the average value; thus, the lower part of the quadrant is placed rather high.
In the second quadrant, which encompasses the extreme values for the cost vari-
able and where the values for the social progress index register values below the
sample average, a number of 25 countries are included, among which we mention
the following, Chad, Guinea, and Mauritania, for which the total cost of founding a
business surpasses 350%. However, this quadrant also contains countries for which
the value of the total cost implied by opening a business does not exceed 75% of
national income/capita: Dominican Republic, Bolivia, and Nicaragua.

600
II I
Cost (% of income per capita)

500

400

300

200

100

III 0 IV
30 40 50 60 70 80 90
Social Progress Index

Fig. 1.3 The link between the cost of establishing a business and the social program index
10 B. Avram and S. Brad

The following quadrant (III) features countries for which the values of the cost
variable and the social progress index are lower than the average. There is a set of
countries which stand out within this category through the fact that they record the
maximum value for the social progress index and the minimum one for the cost
variable, these countries being the following, Saudi Arabia, Georgia, and South
Africa, while at the opposite pole we find Burundi, Sudan, and Pakistan. In the
fourth quadrant, there are 58 countries and the values for both variables are above
the sample mean. This category includes countries such as New Zealand, the
Netherlands, and Norway, which are characterized by a value of the total cost for
establishing a company below 6% of national income/capita along with the highest
values of the social progress index.
In reference to the manner in which we compute the correlation between the two
variables, we have in this case, also, the Spearman coefficient which registers a
value of −0.47 and as a result of the value of Sig <0.05 suggests a significant reverse
relationship between the variables. Such a relationship indicates that a higher level
of the social progress index determines a lower expected value of the cost variable.

1.6 Economic Development Indicator

The scatter plot in Fig. 1.4 represents the relationship between the number of proce-
dures, which are required in order to establish a company and the GDP/capita. In
resemblance to the previous cases, the graph is constructed by intersecting the lines,
which cross the mean values of both variables we have employed in this case.

18
II I
16

14
Number of Procedures

12

10

2
III IV
0
0 20,000 40,000 60,000 80,000 100,000
GDP per capita (current US$)

Fig. 1.4 The link between the number of procedures necessary to open a business and the eco-
nomic development indicator
1 Country Benchmarking for Setting Up a New Business 11

Quadrant I features nine countries that present values for both variables above
the sample average, among which we mention: Chile, Slovak Republic, and Trinidad
and Tobago (with minimum values of GDP/capita) and Germany, Austria, and
Kuwait (with maximum values of GDP/capita). The largest number of countries, 46,
can be observed in the second quadrant. They are characterized by below-average
values of GDP/capita and above-average values of the number of procedures future
entrepreneurs are required to follow in order to open a new business. In addition, for
the country with the lowest GDP/capita (Malawi), Uganda and Mozambique pertain
to this quadrant. With values of the GDP/capita near the average of the economic
development indicator, Brazil, Croatia, and Argentina are located in the lower right
part of this quadrant.
The third quadrant comprises approximately the same number of countries as
quadrant II and includes countries such as Burundi, Liberia, Madagascar (minimum
values of GDP/capita), as well as Kazakhstan, Poland, and Russia (with values of
GDP/capita approaching the upper bound of the interval). In the final quadrant,
which features 27 countries, the country with the highest value of GDP/capita can
be found. It is characterized by only four procedures that have to be followed in
order to establish a company (Norway). Furthermore, values of GDP/capita that is
as high as six times the average value can be associated with Australia and
Switzerland. Although Latvia, Lithuania, and Uruguay are at the lower end of the
GDP/capita ranking, they register values of this indicator that are 1.000 $ above the
average and a mean of the number of procedures of 4.
In order to analyze the correlation between GDP/capita and all of the three vari-
ables, we have studied the distribution of the variable, which has proven not to be a
normal one, thus leading us to the employment of the Spearman coefficient. The
value of this coefficient is −0.271 and the value of Sig > 0.05, resulting in evidence
in favor of a negative correlation between the two variables, however not a strong one.
The previous situation can be encountered in this case as well; as the number of
days required in order to open a business plotted as a function of the GDP/capita
appears in the majority of the cases for the countries that pertain to the second and
third quadrants (Fig. 1.5). This aspect is due to the GDP/capita variable, which
­registers numerous extreme values that can also be deducted from the large value of
the standard deviation (19.511). Among the countries that are part of the second
quadrant (38 countries), there is also Malawi, which besides the fact that has the
lowest GDP/capita, it also has a number of days needed to establish a business that
is double of the average value. Another country which stands out within this interval
is Brazil, which is characterized by the highest value of the time variable and a
below-average value of GDP/capita.
Quadrant III includes the most significant agglomeration of countries (51), which
report values of the number of days required to establish a company below average.
We can observe that in this quadrant, the countries, for which the value of GDP/
capita is near the average value, register an average number of 9 days, which are
necessary to follow the procedures and open a new business.
In the fourth quadrant, we included the countries in which the conditions of
opening new businesses are the most favorable due to the low number of days
12 B. Avram and S. Brad

90
I
80 II
70

60
Time (days)

50

40

30

20

10
III IV
0
0 20,000 40,000 60,000 80,000 100,000
GDP per capita (current US$)

Fig. 1.5 The link between the number of days needed to establish a business and the economic
development indicator

needed to finish the process (lower than the sample average) and values of the
GDP/capita situated well above the average. It is not surprising to note that coun-
tries such as Australia, New Zealand, and Switzerland pertain to the group of coun-
tries, which offer the most appropriate conditions to the development of the business
environment.
The value of the Spearman coefficient which we have used in order to study the
connection between the two variables and that of Sig <0.05 indicates that there is a
weak negative relationship between them (Spearman coefficient = −0.318).
The scatter plot presented in Fig. 1.6 reveals the connection between the cost
implied by opening a business and GDP/capita. It is interesting to note that in the
first quadrant, there are only three countries (Slovenia, Germany, and Kuwait),
which register values for both variables above the average of the sample. In contrast,
the third quadrant encompasses 61 countries, representing the largest agglomeration
of countries. Among these, we can mention Burundi, Liberia, Madagascar,
Argentina, and Kazakhstan. The second quadrant presents the countries for which
the total cost implied by establishing a new business surpasses 200% (Guinea, Mali,
Chad, Burkina Faso, and Mauritania), countries which are characterized by values
GDP/capita below 1.100 $/capita.
However, there are several countries which, although featuring a total cost higher
than 50%, have a value of GDP/capita larger than 5000 $. In the fourth quadrant, we
can encounter countries that stand out with significantly large values of the GDP/
capita and, at the same time, the total cost for establishing a business below the average
of the sample. The most remarkable countries among these are New Zealand, Australia,
and Sweden which, along with the value of GDP/capita that exceeds 60,000 $, have a
percentage of the total expenses required to found a new business below 15%.
1 Country Benchmarking for Setting Up a New Business 13

600
II
Cost (% of income per capita) I
500

400

300

200

100

0 III IV
0 20,000 40,000 60,000 80,000 100,000
GDP per capita (current US$)

Fig. 1.6 The link between the cost of establishing a business and the economic development
indicator

Concerning the correlation between the two variables, it is worth mentioning that
we have computed it using the Spearman coefficient and that we can observe in this
case, also, that we are confronted with a reverse relationship. Furthermore, in this
situation the correlation is the strongest out of all the cases in which we have ana-
lyzed the influence of the economic development indicator on the number of proce-
dures, number of days, and total cost implied by opening a business (the value of the
Spearman coefficient is equal to −0.467).

1.7 Conclusions

In this paper, we have discovered that between the social progress index and the
number of procedures, days, and total cost that are required to open a new enter-
prise, there are negative correlations, the strongest one being present between the
economic development indicator and the total cost implied by establishing a busi-
ness. Moreover, it should be emphasized that the strongest relationship between
GDP/capita and the variables under analysis is present between the economic devel-
opment indicator and the total cost variable. On the other hand, the link between the
social progress index and the number of procedures required to open a business
stands out with the lowest values of the correlation coefficient. In reference to the
relationship between GDP/capita and the variables subject to our analysis, the last
place is reserved for the negative correlation between this economic development
indicator and the number of procedures necessary to found a business.
Despite the fact that the negative correlations are not strong, they, however, are
significant and this can be noted from the graphical representation of the countries
14 B. Avram and S. Brad

included in the sample. In addition, our attention is drawn by countries such as New
Zealand, where the social and economic progress indicators that have high values
lead to a lower number of procedures, days, and the total cost that have to be borne
by the future entrepreneur. A similar phenomenon can be noticed in the case of
countries such as Iceland, Switzerland, the Netherlands, and Norway. These signifi-
cant negative correlations also emerge in countries that are defined by low values of
the social and economic development indicators. Examples of such countries are
Chad, Angola, Sudan, Bosnia and Herzegovina, and Kuwait.
Our recommendations for the economies that pertain to underdeveloped and
developing countries are to create efficient and transparent norms that are aimed to
reducing bureaucracy. These norms and regulations should lead to a drop in the
number of procedures and days that are required to establish a new enterprise.
Although these administrative issues are reduced, in order to encourage the growth
of the number of businesses and, implicitly, of the economy, we suggest that, also,
the total cost implied by the act of opening a business, especially the amount of
money that should be deposited in a bank account, should be diminished.

Acknowledgments We would like to acknowledge the Ph.D. scholarship: Investing in People!

Project cofinanced by the Sectoral Operational Program for Human Resources Development
2007–2013, Priority Axis 1. “Education and training in support for growth and development of a
knowledge based society,” key area of intervention 1.5: Doctoral and post-doctoral programs in
support of research. Contract nr. POSDRU/159/1.5/S/137070 – “Increasing the attractiveness and
performance of training programs for doctoral and postdoctoral researchers in engineering sci-
ences - ATRACTING,” Technical University of Timisoara, Romania.

Bibliography

Bishop, M. (2013, April 18). Beyond GDP. Retrieved from The Economist: www.economist.com.
Bruhn, M. (2011). License to sell: The effect of business registration reform on entrepreneurial
activity in Mexico. Review of Economics and Statistics, 93, 382–386.
Djankov, S., La Porta, R., Lopez-De-Silanes, F., & Shleifer, A. (2002, February). The regulation of
entry. The Quarterly Journal of Economics, 31, 595–619.
Djankov, S., Glaeser, E., La Porta, R., Lopez-de-Salinas, F., & Shleifer, A. (2003). The new com-
parative economics. Journal of Comparative Economics, 31, 595–619.
Doing Business. (2012). Doing business in a more transparent world. Washington, DC: The
International Bank for Reconstruction and Development/The World Bank.
Doing Business. (2014). Doing business 2015 going beyond efficiency. Washington, DC:
International Bank for Reconstruction and Development/The World Bank.
Fehder, D., & Stern, S. (2013). The social progress index methodology (pp. 39–54). Washington,
DC: Social Progress Imperative.
Klapper, L., & Love, I. (2010). The impact of business environment reforms on new firm registra-
tion. The World Bank. Policy Research Working Paper Series 5493.
Klapper, L., Amit, R., Guillén, M. F., & Quesada, J. M. (2007, September). Entrepreneurship and
firm formation across countries. Research at The World Bank.
van Stel, A., Storey, D. J., & Thurik, R. A. (2007). The effect of business regulations on nascent
and young business entrepreneurship. Small Business Economics, 171–186.
Verstraete, T., & Jouison-Laffitte, E. (2011). A conventionalist theory of the business model in the
context of business creation for understanding organizational impetus. Management
International, 15, 109–124.
Chapter 2
The Image of Local Public Administrations
in Transylvania Among Citizens: An Empirical
Study

Dan-Cristian Dabija, Ciprian-Marcel Pop, and Raluca Băbuţ

Abstract For many years, excessive bureaucracy and widespread corruption have
been the major scourges of the public administration system. The reform in public
administration created the need to rethink the entire public administration system,
the services provided to citizens and the manner in which citizens are approached
and dealt with. The major challenge lies not only in providing citizens with full
access to various public services (waste management, street lighting, public secu-
rity, education, health care, culture, etc.) but mostly in building a lasting relationship
based on mutual trust and sympathy along with a reconsideration of the way in
which the citizen is perceived by the civil servants. At the beginning of the new mil-
lennium, civil servants are expected to be kind and helpful to citizens, eager to help
them solve their problems quickly and effectively.
Due to the European integration and to the need to make the entire decisional
process more transparent at local and central levels, several aspects are becoming
imperative in what concerns the public administration bodies, such as the necessity
to make a good impression on citizens, to raise their interest, to grow awareness, to
develop a mutually advantageous relationship and practically to gain people’s trust.
Developing a positive image is all the more important as, regularly, by voting, peo-
ple can sanction the behaviour of the public administration representatives. This is
why, by facilitating the free and unimpeded access of citizens to various public
services and by supporting them any time they need it, the public administrators lay
the foundations for a long-term relationship with the former.
Aware of all problems and difficulties faced by public administrations in
Romania, the authors of the present research attempt to identify the major aspects
that public authorities and institutions must take into account when drawing up their
general strategy for approaching the citizens. Based on the empirical research con-
ducted in various types of localities in Transylvania, the authors pinpoint a number
of pressing problems of the system and attempt to come up with workable solutions.

D.-C. Dabija, PhD (*) • C.-M. Pop, PhD • R. Băbuţ, PhD

Babeş-Bolyai University, Cluj-Napoca, Romania
e-mail: cristian.dabija@econ.ubbcluj.ro; marcel.pop@econ.ubbcluj.ro;
raluca.babut@econ.ubbcluj.ro

© Springer International Publishing AG 2017 15

S. Vaduva et al. (eds.), Development, Growth and Finance of Organizations
from an Eastern European Context, DOI 10.1007/978-3-319-54454-0_2
16 D.-C. Dabija et al.

The research actually bears great scientific relevance, demonstrated mostly by the
scarcity of similar studies in this field, as well as managerial and practical relevance
useful to decision makers within local public administrations in rethinking the entire
public system and mostly in building a lasting relationship with the citizens.

Keywords Public administration • Image • Citizens • Transylvania • Empirical

research • Small • Medium • Large localities

2.1 Introduction

The role of public administrations is completely different, by far more significant

and more complex than that of organisations focused on achieving major economic
objectives (profit growth, drawing as many customers as possible, sales growth,
increase of market share, complete fulfilment of the customers’ needs, desires and
expectations). They have to properly manage an array of major problems, chal-
lenges and difficulties faced by society in general and by each local community:
securing calm and public order, providing citizens with access to some basic ser-
vices (education, culture, health care), town and country planning, provision of
electricity, ensuring street lighting and waste management, providing support to
underprivileged social classes, making investments in utilities and local transport
infrastructure, attracting strategic investors by providing them with specific aid
measures such as exemption from payment of duties and taxes, infrastructure
improvement and support in recruiting new employees, etc. (Da Silva and Batista
2007). The well-being of citizens and society in general is ensured by central gov-
ernment authorities (Presidential Administration, the Romanian government, the
Constitutional Court of Romania, the Senate, the Chamber of Deputies, ministries
and other specialised, regional or local bodies) as well as by various decentralised
public services under the authority of ministries and some specialised bodies oper-
ating in a particular, clearly marked territory (Ioan 2007; Baciu (Suciu) 2014;
Dreptonline 2014).
The achievement of these aims is not only cumbersome as it demands more staff
but also difficult mainly due to the lack of available funds, the slow collection of
local taxes and duties, the limited capacity of national or local public institutions
and authorities to obtain grants and the lack of a vision of how to conceive viable
projects. It is also quite difficult to create a proper image of the public administra-
tion in the citizens’ mind, namely, to embed the strategic elements whereby people
are able to understand the manner in which public administrations manage to build
a lasting relationship with them.
Even though local or central public governments do not have the same objectives
and strategies as private organisations, the latter of which are mainly focused on
satisfying customers’ needs, on building faith in the services provided and on gen-
erating a positive, favourable and proactive image, still, for the former as well, it
2 The Image of Local Public Administrations in Transylvania... 17

becomes important and relevant to focus on the citizen, on his wishes and on the
possibilities of shaping his trust and contentment in the public services provided.
The citizen is all the more important for the public administration authorities as, at
regular intervals (4, 5 or more years), he has the opportunity to change the political
colour of the local, regional and national decision makers, thus sanctioning their
success or failure in appropriately implementing various investments and in the
provision of the services he needs. We consider that the public administration is and
remains dependent on the citizen, as he is the pawn who decides in the selection
process of the local and national representatives in the end. Anchoring a positive,
favourable image of the public authorities represents, in the knowledge-based soci-
ety (Pocatilu and Ciurea 2011, 499–503), not only a general idea but also a relevant
strategy worth following (Libaert and Westphalen 2009, 405–411).
A major challenge for the local public administration authorities is represented by
the implementation of the government’s and the central authorities’ decisions at local
level, without altering the citizens’ perception of the political representatives in any
way. Additionally, another challenge is related to the authorities identifying efficient
modalities through which they manage to induce in their customers positive, unique
elements regarding the services they use and to which they have access, regarding
the infrastructure at their disposal, the communication carried out, the quality of the
services provided and the conveyed visual identity (Rădulescu 2013, 50–68; Jézéquel
and Gérard 2012, 30). Thus, it becomes important and relevant to anchor an adequate
image in citizens’ minds. This can be deduced from a set of perceptions and/or opin-
ions fixed in people’s minds throughout time—they shape the dimensions of the
phenomenon relevant to them (Mazursky and Jacoby 1986, 145–165).
The rapid provision of high-class, correct and transparent public services repre-
sents a fundamental vector not only for the development of a favourable image in
the eye of citizens but also, even more, for the enhancement of the localities’ attrac-
tiveness degree towards both potential investors and individuals interested in set-
tling down. In order to shape and especially to consolidate a favourable image, the
local public administration, similarly to other organisations, must put to use a set of
specific means, measures and tools especially directed at the individual: among
these we can mention optimising ways of service provision, establishing attractive
fares, recurring to a citizen-oriented communication which uses both classic and
modern media, etc. In order to investigate these aspects, the authors conducted an
empirical research in several Transylvanian localities varying in population size.
The conclusions drawn allow decision makers to better understand relevant aspects
for the citizen and to elaborate a service offer to his liking.
Being aware of the major problems and challenges faced by today’s public
administrations, the authors of this empirical exploratory research attempt to high-
light how public administrations can generate—using classical marketing tools—a
number of behaviour indicators, embed a proper image and position themselves in
the citizens’ mind. We believe that every time a locality is positively perceived with
regard to its local services, its increased attractiveness will really stir up and increase
the interest of potential investors in conducting business in the area, draw new
inhabitants and contribute to its economic, social and cultural development.
18 D.-C. Dabija et al.

The empirical research conducted in localities of different population size reveals

significant scientific as well as practical implications, its relevant conclusions being
useful to public administrations to better understand citizens when defining their
public services.

2.2 Literature Review

2.2.1 The Local Public Administration

Today’s central, regional and local public administrations, in particular, play an

increasingly important, even vital, role in the citizens’ lives. Without public admin-
istrations, without a ‘referee’ capable of handling various situations (calm and pub-
lic order, access to basic services such as education, culture, health care, etc.),
society would be confronted not only with widespread chaos but also with excessive
corruption and bureaucracy (Ionescu et al. 2012). For that reason, the role of public
administration is an important one, namely, to offset the major negative effects and
to strike a balance between citizens, institutions and different organisations.
According to the literature, public administration consists of all processes, tools and
methods used by governments to draw up and enforce, within current activities,
procedures, laws, legal acts and regulations in order to guarantee transparency in
decision making at institutional level, to limit the political interference in the man-
agement of resources, to minimise the negative effects of bureaucracy and to put up
a brave fight against corruption (completed and adapted Baciu (Suciu) 2014; Cheben
and Hudackova 2010).
Ongoing cooperation must exist between central public administrations and
regional or local public administrations. Whereas central government authorities
usually act in the interest of the entire nation, transcending geographical and territo-
rial boundaries, local authorities contribute to the well-being of the local popula-
tions (communes, towns, cities, counties) (Manda 2007; Suditu et al. 2014). A major
challenge for the central government lies in watching and balancing the ratio
between national strategic interests (building a motorway or a navigable canal,
defending the country against terrorist acts, the development and implementation of
the judicial system, etc.) and the local interests of city halls and councils (providing
the community with access to the national infrastructure, attracting investments to
develop the local transport, tourism, accommodation and procurement infrastruc-
ture, etc.). Strong political dissent as well as a number of interdependences could be
generated in the attempt to reach a balance between conflicting interests. The chal-
lenge lies in finding the best way of serving the citizen and his/her interest (Manda
and Manda 2002). According to Crișan (2013), sustaining cross-sector partnerships,
with private and/or non-profit sector, will set the premises for higher efficiency and
better results in serving the general public.
2 The Image of Local Public Administrations in Transylvania... 19

The local public administration constitutes an administrative structure that per-

mits the local collectivity to solve its intrinsic problems, resulting from the action of
varied coercive factors, but only through the direct control of the central state
authority (Vida 1994). This way the focus is on a series of extremely important
general principles, such as those linked to the decisional autonomy, the decentrali-
sation of services, the increase in ways for the local public administration to access
funds and financing from various sources and the consultation of the citizen so as to
solve local problems (Law 215/2001; Baciu (Suciu) 2014).
Another important aspect both for the citizen and for the local public administra-
tion is represented by the need for a strict control of all money spent on various
projects and allocated in different contexts. As the citizen finances the public admin-
istration, the unjustified or opaque public expenditures may generate conflicts or
major tension both among local public representatives and between them and tax-
payers. Another serious challenge for the local administration authorities lies in the
actual means through which they manage to fundament their decisions. Sometimes
deviations or grave infringements of the local community’s needs, interests and
desires are observed; the consequences of such situations are usually suffered by the
citizen, who has to pay for the incompetence of the authorities by dealing with
increased duties and taxes. This is why, when it comes to making any decision that
involves public funds, one should also take into account the results expected by the
citizen (Baciu (Suciu) 2014, 63; Cheben and Hudackova 2010).
Due to these major constraints faced by central or local authorities, the literature
brought up the issue of reinventing government as early as the late 1980s (Osborne
and Gaebler 1993). According to the literature, the organisational ideas, concep-
tions, values and the ways of doing things typical of the private sector should be
supported and promoted in the public sector so that the latter may demonstrate
improved effectiveness and efficiency. In time, this approach was examined,
changed, customised and improved in many ways either because it was applied
within public administrations in the United States, the United Kingdom, Canada,
etc. (Hood 1995; Torres 2004) or due to the contribution of the literature. Naschold
(1997) and Wallis and Dollery (2005) believe that the new public management ush-
ers in an obvious process of decentralisation of the big institutions, which are bro-
ken down into smaller institutions, thus leading to a certain level of competition
among public institutions themselves as well as between public institutions and
similar private organisations. To put it differently, public administration is being
modernised by the use of specific processes which improve and differentiate its
performance.
The recently developed concept of new public management considers that the
citizen is no longer an ordinary individual who has to accept anything and to sim-
ply obey the local public administration, but rather a buyer, a customer of public
services. This approach has also received lots of criticism; it posits that the citizen
cannot be considered the local public administration’s customer, because there
isn’t a viable alternative for some basic services (health, culture, education, reve-
nue authority, etc.) (Wallis and Dollery 2005; da Silva and Batista 2007). As the
role of the Internet has risen and as there has also been an increase in its level of
20 D.-C. Dabija et al.

access or acceptance within the transactions involving authorities and the public
administration (Gay et al. 2009; Denhardt and Denhardt 2007) on one hand, and
the citizens on the other hand, the concept of digital era governance has appeared.
It is considered to be a successor of new public management.
This new type of governance encompasses a holistic vision, which integrates
components of information technology and of the digital data storage in the rapid
and efficient fulfilment of specific tasks (Pina et al. 2009). An extension of the new
public management concept refers to new public governance, which presupposes a
relative centralisation of the public government’s power (Ferlie et al. 1996; da Silva
and Batista 2007; Pina et al. 2009). The allocation of jobs and functions within the
public administration mainly takes place according to political criteria, which leads
to a massive if not excessive politicisation of the public apparatus. In this manner,
there is a risk of negatively subjugating public service to state power. But, in more
civilised countries, with a long tradition of democracy, with a low level of corrup-
tion and where the transparency of the administrative act is guaranteed, one can
observe market-oriented reforms consistently (Williamson 1994; Rodrik 1996). The
performance of the public administration system can also be enhanced by recurring
to the constant evaluation of employees according to clearly established standards,
to regular rigorous controls and to upholding commitments (Barzelay 1992; Hood
1991; Peters 1996).

2.2.2 Image of the Public Administration

The concept of ‘image of the public institution’ is a key element in the study of the
citizens’ perception of the public authorities. Within the public sector, the image
consists of a set of beliefs, attitudes, opinions, experiences and expectations of citi-
zens with respect to local or central public administration institutions (government,
ministries, city halls, local councils, prefectures, etc.) as well as to civil servants
(Haineş 2010; Nedelea 2006a, b). The image of the public institution is of para-
mount importance because it has a strong bearing on the human behaviour
(Chiciudean 2000), getting the individual to finally endorse or reject politicians for
a new mandate in the local or national elections. To offset potential negative effects
and prevent unforeseeable situations, it is necessary for public institutions to
embrace the concept of public marketing.
From the viewpoint of public administrators, it is very important for them to suc-
ceed in anchoring in citizens’ minds a coherent and authentic image in what con-
cerns their responsibilities and their manner of organisation and functioning, an
image that corresponds to reality and which reflects the way they put into practice
their tasks (Nedelea 2006a, b) in an objective manner. Failure in doing so represents
a real danger to them, because fixing an illusion (a false image) in people’s minds
will lead to an increase in the mistrust citizens have of the public government,
which, in its turn, will have a negative effect on the electoral capital (Coman-Kund
2000). An essential role in promoting a favourable image of the central and local
Another random document with
no related content on Scribd:
making good John's promise that something would be done for Rosner, after
the dramatic encounter in which Rodrigo had saved his friend from the
leaden danger in Rosner's revolver. John had advanced the little man a loan
and placed his ill wife in the hospital. Rodrigo had suggested a way for the
harassed little man to repay the money and regain his self-respect. John's
responsibilities in Dorning and Son had always been too heavy. Rodrigo
suggested the installation of Rosner as John's assistant, pointing out that
while the ex-employee was no executive, he knew the business and would
doubtless prove very acceptable in a subordinate capacity.

During the time Rosner was winning back his health and mental balance,
his duties had been light. In the weeks just before Elise's disappearance, he
had gradually been given larger responsibilities and had been executing them
surprisingly well. Now, with John gone, he stepped manfully into the breach
and performed yeoman service in enabling Rodrigo to carry on. Henry
Madison was his usual capable self in managing the retail sales force;
however, without the aid of Rosner, Rodrigo frequently told himself that the
buying and important outside contract work of the concern, the part of the
business on which the reputation of Dorning and Son rested, would have
gone to pieces.

Moreover, Rodrigo discovered in Rosner, whom he had hitherto regarded

with some distaste, personal qualities and a sympathy that made him really
like the frail middle-aged man and established a bond between them.

It started in the second week of John's illness when Rosner, who fairly
worshipped Rodrigo now for the kindness he had done him, said timidly at
the end of a business conference, "How is John this morning?"

"Improving a little, as rapidly as anybody could expect."

Rosner continued hesitantly, "You're not looking at all well yourself,

Count Torriani. You're worrying too much about John. It's time you thought
about yourself a little. If you don't—well, you may be where he is."

"Would to God that I were!" Rodrigo cried with a suddenness and

vehemence that startled Rosner. In the next instant he was angry at himself
for losing control, for his manifestation of the jumpy state of his nerves. He
continued more calmly, "Thanks for your sympathy, Rosner, but don't worry
about me. I'm all right."

"If you wanted to go away a while, for a rest—I could manage, I think,
after a fashion," Rosner offered.

"Thanks. I know you could. You're doing wonderful work—you and

Miss Drake and all the rest of the people. But I'll stick around until John gets
back in harness. Then I'm going away for a long rest, abroad probably."

After Rosner had gone, Rodrigo realized that their little conversation had
been a relief, even his explosive demonstration of his nervous condition. The
only other person in the establishment with whom he discussed John's illness
was Mary Drake, and to her he merely communicated briefly the latest news
from Greenwich daily, in answer to her question. There was no mention of
their former relations to each other, merely a question and answer about
some one in whom both felt a deep concern. Beyond this and the daily
contacts into which the routine of the business brought them, Rodrigo and
Mary were now to all intents and purposes just an employer and a trusted
employee. Of the frequent anxious and sympathetic glances which Mary cast
at him when he chanced to be facing away from her, Rodrigo, of course,
knew nothing.

It was December, when his illness had run along for nearly two months,
that John Dorning showed a definite improvement and return to normal. One
morning Rodrigo received word by telephone that John was to leave two
days later for southern California, in charge of his sister and his nurse, and
would like to see Rodrigo before he departed. The doctor had declared that a
change of scene would help the patient as soon as he was in condition to
travel. It was thought that John was now strong enough, and the plans had
been made for an indefinite stay in the region of San Diego.

Rodrigo drove up to Greenwich that afternoon. Alice Pritchard ushered

him into John's room, near a window at which his friend was seated, looking
moodily out upon the snow-clad lawn. Though he was prepared to see a
change in John's appearance, Rodrigo was shocked in spite of himself at the
actuality. The face of the man in the chair was white and gaunt. His blond
hair was streaked with gray. He looked at least ten years older than he had on
the day Rodrigo had seen him last. And as, aware of visitors, he turned,
Rodrigo saw that his eyes looked sunken and lack-lustre.

Rodrigo managed a smile as he advanced with hand outstretched. A

semblance of a smile appeared on John's wan face also, and he said in a low
voice, "This is good, old man."

"It is, indeed," Rodrigo said heartily. "I'm glad to see you looking better."

"Yes, I am feeling better. I want to thank you for sticking by me through

it all, Rodrigo. They've told me of the constant interest you've shown and the
fine work you're doing at the shop. I'm sorry to have to impose upon you any
longer—but they tell me I must go away for a time. I don't know that it will
do any good." His weak voice fell away, and his head bowed a little.

"Oh, it's bound to," Rodrigo cut in cheerfully. "New faces, new scenes.
You'll come back a new man, ready to pitch in like a whirlwind."

But John had hardly listened to him. Alice had left the room, as the
patient discovered when he looked cautiously around. At once he caught
Rodrigo's sleeve with his thin fingers and looked at him so pathetically that
the latter wanted to turn his head away. John asked, "Have you learned
anything at all about Elise, Rodrigo?" And when Rodrigo shook his head
slowly, John's hand and head fell and he whispered, "Nothing—in all these
months? It's unbelievable—it's maddening."

Rodrigo hastened to soothe him, to change the subject. A few moments

later Alice returned with the nurse, and Rodrigo deduced that it was time that
he left. The two men shook hands and, with an encouraging caution to come
back strong and healthy, Rodrigo was out of the room.

During the remainder of the winter, the word from California was of
John's constant improvement. He was living almost in the open air and doing
little besides eat and sleep. In February he started writing short notes to
Rodrigo in his own hand. By the first of March, the notes had grown longer
and had lost both their unsteadiness of chirography and the perfunctory air of
being written by a man too tired mentally to use his imagination.
 John was taking an interest in life again. He took to commenting upon
the beauty of the natural scenery about him and upon the desecration being
wrought upon Nature by some of the architectural monstrosities of the
region. He told in subsequent letters of having lunch with mutual business
friends of theirs, of a trip to Catalina Island. He even made some inquiries
about certain projects he had left unfinished upon the occasion of his abrupt
leave-taking from Dorning and Son and urged Rodrigo to tell him in detail
of his business problems of the hour. This last, to Rodrigo, was the most
encouraging sign of all.

Early in April, John Dorning returned to Greenwich. Rodrigo spent the

week-end there and rejoiced to see his friend looking so changed for the
better. Though he was still thin and fragile-looking, there was color in his
cheeks and life in his eyes. And whatever his mood might be when alone, in
the presence of his family and of Rodrigo, John was now nearly his old self.
He had, right at the start of Rodrigo's visit, made an effort to prove this by
meeting his friend at the station in the Dorning sedan and driving him to the
house. In answer to Rodrigo's joyous greeting and eager questioning, he
replied, "Yes, I'm in quite good shape now. In fact, Dr. Hotchkiss is so
pleased with me that he says I may come in a couple of days next week for
an hour or so each day and kind of get in touch with things at the shop. And
I'll be glad to do it, I can tell you."

Though Rodrigo sensed somehow that the thought of the missing Elise
still occupied the back of John Dorning's mind, to the exclusion of
everything else, her name was not mentioned at all throughout the week-end.

Sunday morning, Rodrigo rode horseback with John, a pastime which

Dr. Hotchkiss had recommended and which had led to the purchase of two
excellent saddle-horses and their installation in the long empty Dorning
barn. The bridle-path led them quite close to the Millbank development,
where stood the vacant home of John and Elise. Rodrigo did not, of course,
allude to this and even glanced anxiously at John as they passed the place.

"I am going over to my old house next week sometime and take out the
stuff I left there," John said calmly, though Rodrigo wondered if there was
not suppressed emotion behind those quiet words. "I have put the place on
the market and intend to dispose of it." John was frowning and his lips were
clenched tightly.

Rodrigo did not answer him, but soon afterward prodded his horse into a
gallop. John followed him, and they finished their journey at a very rapid
pace. Rodrigo left for New York that evening, very much pleased with his
friend's condition. Some of the heavy load was lifted off the young Italian's
mind at last. Though he had not permitted himself to think about it during all
the long months of that sad winter and early spring, he was utterly worn out
in body and mind. On the rare occasions when he relaxed the grim guard
upon his mind and was weak enough to pity himself, it seemed to him that
soon he must, must get away.

No returning hero ever received a more sincere welcome from his

associates than did John Dorning when he walked into the shop on
Wednesday of the week following. The whole staff abruptly dropped what
they were doing and clustered around him. Hands were outstretched and
grasped. In many eyes there were tears. John, smiling happily, was very
close to crying himself. He thanked them all collectively for carrying on in
his absence, with special mention of Rodrigo, Henry Madison, Rosner and
Mary Drake. The last named dabbed at her eyes furtively and stole a proud
glance at Rodrigo, which he did not catch.

John remained scarcely half an hour, spending the time in a short

conference with the four who composed the executive staff of the business.
On Friday, however, he came in again, this time with a tentative sketch
suggestion for the murals Dorning and Son were to submit for a new art
theatre building to be erected in New York. After this his appearance became
steadily more frequent and for longer intervals.

Two weeks later, he said, at the end of the first full day he had spent at
the shop. "Monday I intend to resume my place here in earnest, Rodrigo. I'm
feeling well now, and I'm perfectly capable of putting on the harness. In fact,
the harder I work, the better I feel. But you've been working too hard,
Rodrigo. You're looking tired and seedy. I really believe I appear healthier
than you do. Don't I, Mary?" The scene was John's office. Mary had just
come in to take away the signed letters. She looked around and smiled at his
question, flashing a glance at Rodrigo but not committing herself to an
answer. "Mary has been a big help to me in getting back into the swim,"
John smiled. "And I intend to lean upon her more than ever." He looked so
affectionately at the grave girl that Rodrigo glanced from one to the other
and experienced a sudden flash of foreboding. John and Mary—now that
Elise was gone—John's need of someone to lean upon—the realization, to
him, of Mary's worth——

But Rodrigo dismissed it from his mind with an effort. He simply would
not think of it. The ache of loving Mary was still too raw in his own heart.

"Why don't you take a long vacation, Rodrigo?" John was saying. "Go
abroad, to Italy, or something. You certainly deserve it. We'll carry on here."

And another portion of the heavy load on Rodrigo's mind lifted. He felt
like sighing audibly with relief. At last he could put into effect the plan that
had been forming in his brain ever since that awful morning. John was well
now, reasonably happy, as happy as he perhaps ever would be again. The
burden of keeping the faith by carrying on his business for him had been
taken from Rodrigo's shoulders. The guilt in Rodrigo's soul could never be
taken away, of course. But at least he could gain some surcease by going
away from this man whom he could never again look in the eye with a clear
conscience, never again see without feeling how he had betrayed him. He
would go away, and stay away. When his heart cried, "But Mary?—You love
Mary. You cannot give her up," he tried to stifle that cry, and resolved, just
the same, to go.

He voiced this resolution to John. "I do need a vacation, John. I'm glad
you suggested it. If you can get along without me, I think I shall book
passage to Italy. My house over there is vacant, you know, and I want to see
about selling it, for one thing. And I should like to see some of my old
friends. And the Bay of Naples, and all the old places. It will do me good.
And perhaps I can pick up some treasures over there at bargain prices. I'll
keep that in mind too."

Rodrigo sailed four weeks later on a Saturday. John bade him good-bye
at the close of the day's work on the afternoon previous, for John was under
the doctor's orders to take two full days' vacation each week-end.
 "When will you be back, Rodrigo?" John asked.

And Rodrigo had hesitated and finally answered, "I—can't tell."

"Well, take your time—but I'll be awfully eager to see you again. I'll
miss you like the dickens," John said rather wistfully.

Rodrigo, his baggage already aboard, arrived early at the steamer that
Saturday. In the midst of the passengers waving and calling to the swarms of
friends standing in the doorways of the pier-sheds, he stood alone on the
deck, looking ashore. He was probably the only one there to whom someone
was not wishing bon voyage, he told himself rather grimly. Then suddenly
he saw Mary Drake and she had finally managed to thrust her slim way
through the gesticulating groups on shore and was searching the deck of the
ship with her eyes.

Rodrigo turned abruptly and hurried down the gangplank. He pushed to

her side.

"This is good of you, Mary," he said to her.

She started, turned, smiled, and said seriously, "I came down to ask you
to reconsider not coming back."

"How do you know I am not coming back?" he echoed the seriousness in

her voice.

"You told me once that you were going away and not return. I guessed
you were only waiting until John was firmly on his feet. He is there now.
And you are sailing away."

"Would you like me to come back—for yourself, Mary?" he asked

hopefully.

"I am not to be considered," she answered almost coldly, though there

was a little catch in her throat. "You should come back for the sake of your
own soul. To run away and stay away is cowardice. You will spend the rest
of your life hating yourself." She lifted her face to his appealingly. "Oh,
Rodrigo, can't you see that the only right way is to tell John the truth, even
now? He can stand it now. And you will save yourself. You are not happy.
You will never be happy as long as this terrible thing is in your heart."

"Is that question of telling John always to stand between us, Mary? Do I
have to wreck John's life all over again in order to make you love me?" He
asked almost bitterly.

She did not reply. The whistle of the great vessel beside them shrieked
mightily amid the hiss of escaping steam.

"Good-bye, Mary," he said brokenly, taking her hand. He hesitated, lifted

it to his lips, and, without another glance at her, half ran to the gangplank,
which had already been lifted a foot off the dock. So he did not see the tears
that streamed down her face, and what was written behind the tears as she
lifted her eyes and realized he was gone.

CHAPTER XVIII

The weather, for the winter season, was unusually fine during the first
five or six days of the voyage eastward, and Rodrigo kept closely to his
cabin. He slept much. It seemed to him that for six months he had gone
virtually without sleep. The slight motion of the ship, the changed
environment soothed him like a lullaby. He rested soundly at night and took
frequent naps during the day. By the time the inevitable change in the
weather came and stormy seas tossed the staunch vessel about so violently
that his cabin had become virtually untenantable, he was fit and ready to
endure the gusty blasts and angry, slanting rain. Rodrigo was an excellent
sailor and really enjoyed the decks of a wave-tossed ship.

On a cloudy afternoon, with the wind lashing the rigging with screams
and whines and the waves shooting spray as high as the canvas-protected
bridge, Rodrigo sat wrapped in blankets in a steamer chair and calmly
watched the mountainous watery madness on the other side of the rail. So
thoroughly was the little man in the steamer chair beside him sheltered in
overcoat, cap, and a whole battalion of blankets that Rodrigo was unaware
that another foolish soul, in addition to himself, was on deck. Indeed he
looked around bewildered for a moment to discover where the voice was
coming from when his neighbor addressed him with a chuckle, "'What fools
these mortals be', eh? Freezing to death up here when we might be down in
nice warm cabins?"

Rodrigo laughed, "The cabins may be warm, but most of them are very
damp by this time, I guess, and full of mal de mer germs."

He observed the habitation of this deep, cheerful voice more closely and
saw that it came out of the fat, ruddy, cheerful face of a man about fifty years
old, an American. Rodrigo suddenly became aware that he was very glad to
hear a friendly voice, that he was in need of human companionship. They
continued the conversation and Rodrigo learned that his companion was a
Dr. Woodward from Washington, bound for Rome on a holiday. Still talking
on inconsequential topics in a light, mind-easing vein, they later walked the
abandoned deck together, sloshing through the water that the waves
frequently splattered about them. That evening Woodward transferred his
place in the dining saloon, now also practically abandoned save for them, to
the table where Rodrigo had been eating alone heretofore.

Learning Rodrigo's line of business and having had explained to him

how a titled Italian happened to be connected with a Fifth Avenue art
emporium, David Woodward revealed casually, between courses of a rather
damp dinner, that he was head of the psychiatric ward at the Luther Mead
Hospital, Washington. His charges were for the most part, he explained,
shell-shocked veterans of the late war, though they also included a number
of civilian patients with mental disorders.

"Perhaps it's my association with mental deficients ashore that leads me

to enjoy irrational pursuits, such as getting my feet soaked on a wave-
washed deck," Woodward chortled.

During the next few days which continued monotonously stormy, the
two became quite well acquainted. Under Rodrigo's questioning, Woodward
talked further about his own profession, in which he was deeply immersed
and stood very high.
 On deck one day he made the remark in a discussion of mental disorders
that insanity comes often from too much introspection or the abandonment
of the mind to a single obsession. On an impulse, Rodrigo told him of John
Dorning's experience, making the case hypothetical and, of course, not
mentioning names. Having stated the circumstances, he asked Dr. Woodward
whether there was a chance that the victim might suffer a relapse and topple
over the border-line or whether he might in time completely efface from his
mind the harrowing event that had unbalanced him.

The psychiatrist pondered a moment and then answered, "I should say
that if this man never learns anything definite about his wife's fate, that is,
does not receive information that would give him a new shock, he will go on
much as he is at present. I gather from what you say that he has made a
partial recovery, so that he again finds life tolerable, but that he is in a
measure living under the shadow of the initial shock. Well, that is not so bad.
Most of us are concealing a major worry or two. On the other hand, this
man's salvation probably lies in falling in love with another woman, a
different type of woman from his former wife. That would be an almost sure
way of healing his wound. And I should say that the chances of this
happening are excellent, particularly if the man is being brought into daily
contact with a woman of a sympathetic turn of mind. That's when men
frequently fall in love, you know—when they have suffered tragedy and are
desperately in need of the sort of sympathy only a woman can give."

Rodrigo suddenly abandoned the subject, for in this "woman of a

sympathetic turn of mind" he had seen, in a flash, Mary. Would she and
John, thrown together now, with John aching for someone to minister to his
bruised mind, fall in love? Having, as he tortured himself into believing, lost
Elise to John, would he now be called upon to give up Mary to his friend, as
if in retribution? He made an excuse, arose abruptly and started to pace the
deck. But this was foolishness, he told himself at length. What if Mary and
Dorning should learn to love each other? It was natural. They had much in
common. They were both fine, wonderful characters. And had he not
virtually abandoned her, lost her by being what she termed a "coward,"
revealed to her he would never return?

He told himself savagely that he was the most selfish man in the world.
And in the next moment he was praying silently that this thing would not
happen, that the two people he loved best in the world would not fall in love
with each other. His heart ached with a pain that was physical.

Just before they parted at Naples, whence Dr. Woodward was to entrain
at once for Rome, the psychiatrist said half-seriously to Rodrigo, "I have
been observing you all the way over, young man. It's a habit of my
profession. You have something on your mind that is gnawing at it. Take my
warning and get rid of it. Get drunk, get married, get anything—but forget it.
Remember what I told you. Don't think too much. It's a bad habit."

Rodrigo walked alone along the crowded, dirty streets of the familiar
city, which was bathed in a warmth and sunshine far different from the damp
and cold that had remained with them the greater part of the voyage over. He
secured a room at the Hotel Metropole and, upon awaking and dressing the
next morning, strolled out upon the balcony of his room to hear the cries of
his countrymen driving their carts past the hotel, the protesting shrieks of the
miniature trolley cars as they crawled up the hilly streets of the city, the
automobiles bustling about with reckless young Italian chauffeurs at the
wheel, the old smell and the gay colors that he had grown up with.

He paid a visit before lunch to the real estate man who had the palace of
the Torrianis in charge and was told by that brisk, sharp-faced individual that
his cable had been received and that he was awaiting Rodrigo's word before
renting the place again.

So it was that the heir of the Torrianis was bumped out to his palace in a
hired automobile a few hours later and had the doubtful pleasure of strolling
through the great empty rooms of the dwelling of his ancestors. The place
had suffered a little from the American tenants who had occupied it. Some of
the precious frescoes had been chipped, and the whole establishment was
musty and dirty. Rodrigo prepared to leave the historic pile with a feeling of
depression. Its sorry condition, contrasted with the spick-and-span modernity
of the surroundings he had become accustomed to in New York, weakened
whatever idea he might have had of settling there. Nevertheless, sentiment
and his now comparative affluence demanded that he restore the palace to a
habitable condition. He was therefore doubly glad, as well as surprised, to
observe standing beside his rented conveyance a familiar, corpulent female
form as he came out.
 Maria had been talking excitedly to the chauffeur and now came
waddling up to meet her former master. A smile covered her wide and
usually stolid face. Rodrigo greeted her heartily and learned from the torrent
of words that came from her toothless mouth that she was working in a
neighboring villa, which, like the palace of the Torrianis, had been rented by
Americans. But, she explained, her Americans were leaving. Had Master
Rodrigo come home for good? Would he, perhaps, want old Maria again?
She had many times, after the departure of Rodrigo's American tenants, tried
to get into the place to clean it. But the pig of a real estate man had refused
her a key—her, Maria! Rodrigo, upon the spot, hired her as the permanent
caretaker of the palace and turned over to her the massive keys to the outer
gate and to the main entrance of the building. She beamed at him as he
stepped into the ancient automobile. She shouted blessings upon his head
until he disappeared over the hill in a cloud of dust.

It seemed his afternoon for renewing old acquaintances, for a little over a
mile from Naples he was about to pass a man and a woman plodding along
the dusty road when suddenly the woman raised her head from under the
heavy cloth-wrapped bundle she was carrying. It was Rosa Minardi. Rodrigo
at once had his car stopped. Rosa, smiling, set down her bundle, and the man
with her, who was quite unencumbered and was smoking a long, curved
pipe, followed her leisurely to the side of the automobile. Rosa, after the first
greeting, introduced the loose-jointed, lazy-looking fellow as her husband.

She looked older, stouter, and considerably less attractive than she had
when Rodrigo had last seen her. He wondered if she had really changed or
whether it was because that painful scene in which her father had extorted
five thousand liras from him seemed now to have taken place years, instead
of months, ago, in quite another world. Certainly there seemed nothing
particularly alluring about her now, though she was rolling her bright, black
eyes at him hopefully and striking attitudes to display the outlines of her too
buxom figure as she talked. She was finding the pose difficult, however.
There were tired, aging lines under those eyes. And there was the slouching
hulk of a man watching her mildly, her husband. Rosa glanced from Rodrigo
to this husband, and sighed. The Minardis never had luck. Her worthless
father had long since spent his tainted profits from her love affair with
Rodrigo. That same worthless father had saddled this equally worthless
husband upon her, with the promise that the man was rich, and had then
borrowed what little money his son-in-law possessed and disappeared once
more to Rome.

This, Rosa did not, of course, tell Rodrigo. Instead she said soberly, "You
are looking pale, my friend, and older. Has life not been so gay in America,
eh?

"Oh, it has been gay enough," he replied, and he began to admit to

himself that he too must have changed, what with John and Dr. Woodward
and now Rosa telling him of it.

"Do you think, then, to remain in Italy?" she asked, and he thought he
detected a little gleam in those once inviting eyes.

The question having thus been put to him directly, he made a decision
and said, "No. I am going to travel a while. Later—I do not know. But I am,
as you have guessed, Rosa, not so gay. Perhaps in Paris or London I shall be
gayer."

"You used to be—very gay," she mused, and again smiled at him
coquettishly, but heavily, as if trying to say that it was not impossible that
those happy times might be revived. But, though he returned her smile, she
failed to stimulate him. Indeed he found her more depressing even than the
palace of his fathers. Bright-eyed Rosa turned drudge, slave of a dirty,
indolent Italian husband! Well, that was life. As he started on again and
looked back at her, trudging under her burden along the dusty road, the man
walking, hands in his pockets, by her side, Rodrigo knew that, even had she
been twice as pretty as ever, she would not have struck a spark in him. His
old weakness for a pretty face had been killed. And the pity of it was that it
had been killed just too late.

He visited Paris, Paris striving to display its old pre-war gayety in the
sunny days of a perfect spring. He looked up some old acquaintances,
English and Italian artists of the Latin Quarter for the most part, and drank
wine with them and talked and tried to recapture some of the old carefree
spirit in the musty cafés of Montmartre. He attended the theatre, alone and in
the company of his friends and browsed among the galleries and shops,
making a few purchases and forwarding them to Dorning and Son. For he
could not forget that he was still, in name, John's partner. He found himself
frequently speculating, almost unconsciously, as to the outcome of business
projects he had had under way when he left and had more than one impulse
to write or cable about them. Would he, after all, go back? Dorning and Son
had become even more of a part of him that he had suspected. And John and
Mary—yes, he wanted that adopted world of his back again intensely
already, though he had been gone hardly a month.

Yet the prospect of facing John Dorning day after day, facing his dearest
friend with a guilty lie in his heart—and the ache of being near Mary and
knowing she was lost to him—he could not endure that!

He crossed the Channel in May, reaching London on a wet and foggy

night and establishing himself at the Savoy. For the next few days he loitered
in his room, sleeping late and eating only when he felt an active hunger, and
walking purposelessly about the streets. On the third evening, over a
lonesome dinner, he read by chance in the paper of a play that had opened
the night before. It was a problem play called "The Drifters" and, according
to the reviewer, possessed considerable merit. Rodrigo was surprised and
interested to see the name of Sophie Binner in the cast. Far down in the
review, he read a paragraph devoted to Sophie's performance. It said that
Miss Binner, late of the musical comedy stage, showed distinct promise in
her first straight dramatic role, that the mannerisms which used to delight
revue patrons had quite disappeared, that "the former Christy ingenue has
demonstrated that she is a character actress of polished competence and, of
course, outstanding beauty."

Rodrigo was viewing "The Drifters" an hour later. He found its opening
act rather ponderous and talky, until the entrance of Sophie. In the plain
tailored suit and subdued make-up which her role called for, she was, he was
surprised to discover, more striking in appearance than she had ever been in
the tinsel costumes she had worn for Gilbert Christy. Her shiny golden hair,
now cropped and confined closely to her head, instead of flying in the breeze
as previously, set off her piquant, innocent-wise face in fascinating
effectiveness. Her voice had somewhere lost its rasping overtone and
acquired clarity and gentility. She moved surely and with an understanding
of her part that was in amazing contrast to the slovenly manner in which she
had always filled the meager requirements of the bits she had played in
Christy's sketches. Formerly Sophie had been able only to sing, dance, and
display her figure; now, Rodrigo admitted, she was a real actress. He became
interested in discovering how the metamorphosis had come about. His
chance came more quickly than he had bargained on.

Just before the curtain rose for the second act, an usher handed Rodrigo a
card as he resumed his chair very near the stage. The card read:

Rodrigo:

I noticed you in the audience. I would like to talk with you.

Come to my dressing-room after the show, if you care to.

SOPHIE.

It was significant of the change in her, he realized, that later she kept him
waiting outside her dressing-room, when he knocked, instead of crying
carelessly for him to enter. When she appeared at the door at last, she was
dressed simply and becomingly, far more modestly than in the old days. She
greeted him cordially enough and accepted his invitation for a bite of supper
in a small restaurant just off Piccadilly.

"You are thinner and older," she accused him, when later they were
seated cosily in a corner of the smoke-filled and talk-filled room, for the
place was a popular rendezvous for after-theatre crowds, though nothing in
the way of entertainment was offered except excellent food and a congenial
atmosphere.

"You have changed yourself," he retorted. "Tell me how it happened—

why you decided to become an actress."

"I think your friend John Dorning had more to do with it than anything,"
she surprised him by replying.

"John—but how? Do you mean something he said or did the time you—"
He stopped in confusion.
 "Go on. I don't mind," she laughed. "All that seems very far away now. I
don't know whether or not he told you—I imagined he wouldn't—but I came
to see you when I was down and out and—well, I got two thousand dollars
from Mr. Dorning by a rather shabby trick. But I received a lot more from
him than that, though he'll probably never know it. He's a wonderful man. I
was in no mood then for being preached at though, but somehow he made
me listen and he got over to me, without preaching at all, just where I was
headed. He said that no woman had ever found real happiness in living on
other people and that if I was any good and had any real love for the stage I
would dig out on my own and try to get somewhere.

"When he handed over the two thousand dollars, he said that if I was
wise, I would take it and use it to tide myself over while I tried to build a
real career. What's more, he offered to send me more if I needed it and could
prove I was honestly making an effort to succeed in my profession. That was
real sportsmanship, wasn't it? I thought so. So I chucked the musical comedy
business and caught on with a small stock company in Leeds. I studied day
and night, I worked like a dog, and well, I'm a little way on the road to
somewhere now."

"I'm glad, Sophie," he said honestly. "John's a prince. I know that too."
He looked across the table into her grave blue eyes so intently that her eyes
widened into questioning. Then she smiled understandingly.

"I know what you are thinking, Rodrigo," she said softly. "You are
thinking that this is the first time you have ever been with me alone that you
did not want to take me in your arms and kiss me. The first time that we
could sit here comfortably as friends, without making love. I have been
thinking the same thing. And it's true. I used to be an awful man-hunter. I
used to think I wasn't living unless I was mad about some man—one or
more. I remember that I could have killed you that night you left me in New
York. But I have learned different. I have your friend, John Dorning, largely
to thank for that."

When he left her at her apartment later, he felt that he had gained a
friend.
 A letter was handed him by the room clerk that night when he called at
the desk of the hotel for his key. Rodrigo stared at the rectangle of white. In
the corner was the neat, familiar name of Dorning and Son. The envelope
bore his name, typewritten, was addressed to the Palace di Torriani, Naples,
and contained scribblings on its face in pencil that had forwarded it to Paris
and thence to London. Maria, he decided, had been the original recipient and
had sent it to the address he had given her in Paris. He thrust the letter into
his pocket and summoned the lift to take him to his room. He wanted to read
this message in seclusion, for he had a foreboding of its importance. His
original quaking thought that something had happened to John, he assured
himself, was absurd. In that event, he felt, Mary would have cabled him.

He sank into a chair, lit a cigarette, and applied trembling fingers to the
envelope.

Dear Rodrigo:

I do not know how firmly your mind is set by this time upon
remaining in Europe. I do know that something unexpected
has developed here that vitally affects you and John and all
of us.

John is sure you will return soon and intends to tell you then.
I am not so sure you are coming back, but I emphatically
urge you, for your own sake, to do so, at least until you can
learn of these developments from John's own lips. Return to
Europe later if you like, but—come now.

I cannot tell you more. Perhaps I have told too much already.

Sincerely yours,
MARY DRAKE.

He leaned back in his chair and closed his eyes. Mary! He had known
instinctively, when the letter was handed to him, that it was from Mary.
Suddenly its meaning flashed upon him. She and John loved each other,
were going to be married, and wanted to tell him about it, wanted him to
take charge of the business while they were away on their honeymoon. In
vain he told himself that the thought was absurd, that, if such a thing had
really happened, Mary would have written him a straightforward letter about
it instead of this cryptic note. Ever since he had left New York, this idea—
yes, he might as well admit it—this dread of Mary and John loving each
other had hung over his head. Yet why should he dread it? It was no more
than fair. A love for a love. He had taken Elise from John; now John was
taking Mary from him.

He lay awake all that night, fearing, restless, unhappier than he had ever
been in his life. The next morning he engaged passage for New York on a
steamer leaving within three days.

CHAPTER XIX

Rodrigo nodded his way through the surprised, cheerful greetings of

Dorning and Son's staff stationed out in the exhibition rooms and
approached the open door of John Dorning's office with an odd mixture of
eagerness and reluctance to confirm the fears within him. Almost on the
threshold, a voice stopped Rodrigo and he turned to face the smiling visage
and outstretched hand of Henry Madison.

"Well, well, this is a surprise," Madison chuckled. "John will be

delighted to see you." And in answer to the questioning look in Rodrigo's
eyes, he added reassuringly in a lowered voice, "John is quite his old self
now—thanks to Mary Drake. She's done wonders with him, made a new
man out of him. You'll see." He shook hands again and suggested—"I'll drop
into your office later if I may and hear about your trip."

"Yes—do," invited Rodrigo in a preoccupied tone.

When he stepped into the doorway of John's office, he heard the precise
accents of his friend's voice dictating a letter. The voice was strong, firm.
Yes, John must be quite his old self, as Madison had said. "She's done
wonders with him." In the next moment, Rodrigo had walked into the room.
The dictation ceased abruptly, a cry of surprised joy burst from John's lips as
he rose and rushed toward Rodrigo. He pumped the returned voyager's hand,
pounded him upon the back. It was several moments before Rodrigo could
turn to Mary, who had also risen and was standing quietly near the exultant
John. She was smiling too as he took her hand and pressed it hard. But as
Rodrigo turned to John again, she quietly left the room, pausing at the door
and looking her gladness at the two reunited friends.

"Yes, I am feeling very well now," John answered Rodrigo's

congratulations upon his improved condition. "Thanks to Mary. She's been a
wonder. I don't know how I could have gotten along without her. She's
worked her head off helping me get back into my stride again. I've had her
up to Greenwich with me several week-ends at Dad's house helping me
catch up with my correspondence. Alice and she have become great pals,
and Dad thinks there's nobody like her."

"There isn't," Rodrigo cut in succinctly.

John regarded him curiously. "Nobody can help loving Mary," he said.
"She's one of the best."

Rosner, having learned of Rodrigo's arrival, walked in at that moment

and greeted the prodigal with his nervous effusiveness. He, too, was looking
in ruddy health. Everything at Dorning and Son's, indeed, seemed to be
progressing excellently without him, Rodrigo thought a trifle wistfully.
When the little man had departed, the Italian turned to John and announced,
"I must see about getting my baggage through. I'll see you later!"

"By all means," said John. "I'm living at our apartment again, you know.
I'll meet you there and we'll go out to dinner. Later we'll go back and have a
long talk. I've something important to tell you, old man, something that
vitally concerns us both." John's face had turned very sober, and there was a
return of the old sombreness about his eyes that had been part of the outward
sign of his recent ordeal.

Rodrigo strolled into his own office, intending to greet his secretary and
inspect the mail that had arrived in his absence. That worthy and very
homely lady was, for the moment, out of the building somewhere, but,
opening the center drawer in his desk, he discovered an accumulation of
letters neatly stowed away. He sat down, and, spreading the mail upon his
desk, started leisurely to slit the envelopes. He looked up and arose as Mary
slipped into the room.

"I wanted to see you alone and tell you how glad I am that you have—
come back," she said eagerly, a look of gladness in her eyes that caused his
pulse to quicken a little.

"I came because of your letter," he declared. He braced himself and

added fairly steadily, "What are the 'developments' you spoke of?"

"Hasn't John told you?"

"No."

"Then he will—a little later. You will find they are worth changing your
plans for."

He fingered the paper-cutter nervously. "John looks like a different man

than he was when I last saw him," he said. "He seems at peace with the
world at last, to have forgotten—his tragedy. I think you are the cause of it,
Mary."

She paled a little. "What do you mean?" His tense voice frightened her.

And then he found he could not voice his fears, could not bear to force
her to tell him that he had lost her. "Why, he has learned to depend upon you,
and you have given him a new outlook on things, cheered him up, made a
man of him again. You have been such a—wonderful friend to him."

She looked at him quizzically, alarmed at his peculiar manner.

"Everybody is his friend," she said soberly. "Everybody loves John. He is the
salt of the earth."

"He is that," Rodrigo agreed, and he watched her go away from him,
back to John.