Income multiplier per one standard-deviation improvement in institutional quality, across major econometric studies and FDI analyses.
Institutional quality improvements generate multiplicative, not linear, returns to national income. Across six independent econometric specifications and three decades of evidence, every study finds that a one-standard-deviation improvement in rule of law, property rights, or judicial independence multiplies per-capita income by a factor of three or more.
The range from 3.0x to 13.2x reflects methodological variation — OLS estimates sit at the conservative end, while instrumental-variable approaches that correct for endogeneity push the multiplier higher. FDI data reveals the sharpest gradient: institutional improvement in lower-middle-income countries attracts 13.2x more foreign direct investment, suggesting that capital markets price governance quality aggressively.
The directional finding is robust across all specifications: justice is not a luxury good that follows growth. It is the precondition that enables it.