Emmanuel Teitelbaum raises some very valuable points regarding my book. First, on the issue of regime type, I argued that the central variables that affect equitable development are the character of institutions, especially institutionalized political parties and cohesive state structures, and pragmatic ideology—not regime type. While one conclusion that emerges from the study is that illiberal regimes (Malaysia and Vietnam) have done better than liberal regimes (Thailand and the Philippines), I do not argue that illiberalism is a necessary variable for equitable development. The record across the developing world shows that many authoritarian regimes have very dismal economic outcomes. My argument hinges on the power, responsiveness, and capacity of institutions.

Yet, as Teitelbaum notes, Jean Drèze and Amartya Sen discern two pathways for equitable development that are distinguished in terms of regime type. In the authoritarian pathway, elites employ the state and party to pursue reform, while in the democratic pathway, social mobilization pressures elites to address the concerns of the poor. This is one plausible way of analyzing the politics of equitable development. However, if we focus on institutions, we are likely to find a more unified and compelling theory that cuts across regime type. Thus, despite representing a range of regime types, countries with effective and powerful institutions, such as Taiwan, Malaysia, Japan, Costa Rica, South Korea, Mauritius, and Kerala (India), have all achieved some level of equitable development.

On the question of ethnicity, I argued that social structure—the correlation between an ethnic majority and low economic status—cannot explain Malaysia's success in equitable development. Teitelbaum posits that perhaps ethnicity mattered in a somewhat different way. Because ethnic groups are large in Malaysia, they may have helped shape a large minimum winning coalition, and this in turn would have created incentives for politicians to provide public goods rather than private goods. Theoretically, it is possible that these incentives based on a large winning coalition may be present. Furthermore, in my book I noted that the correlation between ethnicity and class provides an incentive for addressing inequality as a political issue. But the problem with an argument based on incentives is that it is insufficient. Furthermore, such an argument assumes an automatic relationship between an incentive and an outcome. However, between the incentive and the outcome lie crucial intermediate variables. Not all parties will respond similarly to incentives, nor will they necessarily have the capacity to follow through. What ultimately matters is the kind of party and its capacity to pursue reforms. Arguments about incentives and institutions are not mutually exclusive. But the key point is this: Incentives do not automatically lead to social reforms or public goods.

On the issue of methodology, I was not trying to identify which aspects of institutionalization matter. I argued that the combination of pragmatic ideology, organizational complexity, and social rootedness made Malaysia and Vietnam more successful than Thailand and the Philippines. The argument works to the extent that all of the variables cluster together and move in the same direction. Teitelbaum also notes that variables such as ethnic structure, colonial history, international relations, and geography all vary, thereby potentially affecting the outcome. For the key pairing of Malaysia and Thailand, I argued that ethnic structure is comparable. In both countries, the ethnic Chinese make up a significant percentage of the country. Malaysia and Thailand are, in fact, the countries in Southeast Asia with the largest Chinese minorities. In terms of colonial history, the positive cases both have histories of anticolonialism, whereas the negative cases do not (for the Philippines, I refer to the period once the revolutionaries were “pacified” by the United States). As for geography and international relations, these countries are all in Southeast Asia, thereby being shaped by common external variables.

Lastly, Teitelbaum questions the evenness of the dependent variable. The dependent variable I use to frame the study is the gini coefficient. Here, Malaysia and Thailand diverge sharply. But Teitelbaum argues that the policy sectors I look at to examine commitment to the eradication of poverty are uneven. I do not contest this point and noted as such in the book's introduction. The reason is that some sectors were more relevant to the politics of inequality in one country than another. To that extent, the specifics of the case affected which sectors I emphasized.