IESET.
Hypotheses·growth·bukele_fdi_gdp_investment_climate_2019_2024

El Salvador's FDI inflow, real-GDP growth, tourism arrivals, and business-formation rate accelerated under the Bukele era (2019-2024) relative to a Central American peer-country donor pool (Honduras, Guatemala, Nicaragua, Costa Rica, Panama, Dominican Republic).

The pre-registered claim is that under a synthetic-control design, Salvadoran cumulative real-GDP growth 2019Q2-2024Q4 and cumulative FDI-inflow-share-of-GDP exceed the synthetic counterfactual with permutation inference at p < 0.10, and that tourism arrivals growth 2022-2024 (once post-COVID recovery paths are netted out) is faster than the peer-pool weighted average. The intended mechanism is a combination of (a) the homicide-rate collapse reducing the country-risk premium and security-driven location avoidance, (b) the 2023 tech-incentive law and tax reform lowering effective entry costs, and (c) the Bukele-brand publicity effect (conferences, Bitcoin-tourism, 'CECOT-tour' narrative). The null counter-claim is that the Bukele era produced no material divergence from the Central American growth path once commodity-cycle and US-demand controls are included.

PARTIALengine/runs/bukele_fdi_gdp_investment_climate_2019_2024

PARTIAL — mean_gap=-0.697, |gap|/pre_sd=1.2, p_perm=1 (gap below 0.5×pre_sd or placebo p≥0.10)

confidence cueThe result is useful, but not decisive. Treat it as a clue, not a settled conclusion.

policy briefMixed or noisy

In ordinary language

Over a long period, do more market-oriented institutions translate into higher income or productivity, once the comparison looks beyond a single success story?

plain answer

The evidence is suggestive but not decisive. mean_gap=-0.697, |gap|/pre_sd=1.2, p_perm=1 (gap below 0.5×pre_sd or placebo p≥0.10)

why it matters

Growth claims can look convincing in single success stories. This test asks whether the pattern survives a broader comparison.

how the test works

It compares 7 country or place units from 2010 to 2025, using a synth did design.

what was measured
What changed
  • Bukele era indicator
  • Homicide rate log
What we checked
  • Real income
  • Foreign investment inflow share income
  • Tourism arrivals
what this does not prove

A single test is not the whole truth. It narrows the claim under a specific sample, time period, and method. Strong policy conclusions need the pattern to survive nearby tests, alternative data, and serious objections.

verification

No evidence packet has been generated yet.

Results

engine/runs/bukele_fdi_gdp_investment_climate_2019_2024
1007550250201020182025SLVHNDGTMNICCRIPANDOM
illustrative sketch · run pending
No coefficients yet. When the model fires, this chart will show real_gdp across 7 sampled countries over 2010–2025.
The shapes above are stylised — none of the lines are real data.
Placeholder for bukele_fdi_gdp_investment_climate_2019_2024. Published chart will be generated from engine/runs/bukele_fdi_gdp_investment_climate_2019_2024/chart_data.json.

Who has skin in the game — schools predicting on this

17 schools list this hypothesis as a test of their position. The chips below are school-level scoreboard outcomes, not a second hypothesis verdict.

hypothesis verdict vs scoreboard outcome

The banner verdict judges this hypothesis as written. The scoreboard asks whether each school's polarity-corrected prediction was right. Raw status is not a school win: SUPPORTED supports schools that needed SUPPORTED, but refutes schools that needed REFUTED.

Austrian Business Cycle Theory (ABCT)wins if SUPPORTEDpartial/no-callChicago School Monetarismwins if SUPPORTEDpartial/no-callClassical Liberalwins if SUPPORTEDpartial/no-callDegrowth / Ecological Macroeconomicswins if REFUTEDpartial/no-callDemocratic Socialism (Bernsteinian revisionism + modern)wins if REFUTEDpartial/no-callStructuralist / Developmentalistwins if MIXEDpartial/no-callEco-Socialism / Red-Greenwins if REFUTEDpartial/no-callEmpirical Pragmatist (the framework's house position)wins if MIXEDpartial/no-callNew Institutional Economicswins if MIXEDpartial/no-callMarket Socialism (Lange-Lerner tradition)wins if REFUTEDpartial/no-callMarxian Political Economywins if REFUTEDpartial/no-callMarxism-Leninism (central-planning implementation)wins if REFUTEDpartial/no-callModern Monetary Theorywins if REFUTEDpartial/no-callNew Keynesian (mainstream synthesis)wins if MIXEDpartial/no-callOrdoliberalism (Freiburg School)wins if SUPPORTEDpartial/no-callPost-Keynesianwins if REFUTEDpartial/no-callSocial Democraticwins if REFUTEDpartial/no-call

Pre-registration

pre-registered
first-spec commit bae09ab · 2026-04-29T22:09:42Z
run generated · 2026-04-28T12:41:54Z

El Salvador's FDI inflow, real-GDP growth, tourism arrivals, and business-formation rate accelerated under the Bukele era (2019-2024) relative to a Central American peer-country donor pool (Honduras, Guatemala, Nicaragua, Costa Rica, Panama, Dominican Republic). The pre-registered claim is that under a synthetic-control design, Salvadoran cumulative real-GDP growth 2019Q2-2024Q4 and cumulative FDI-inflow-share-of-GDP exceed the synthetic counterfactual with permutation inference at p < 0.10, and that tourism arrivals growth 2022-2024 (once post-COVID recovery paths are netted out) is faster than the peer-pool weighted average. The intended mechanism is a combination of (a) the homicide-rate collapse reducing the country-risk premium and security-driven location avoidance, (b) the 2023 tech-incentive law and tax reform lowering effective entry costs, and (c) the Bukele-brand publicity effect (conferences, Bitcoin-tourism, 'CECOT-tour' narrative). The null counter-claim is that the Bukele era produced no material divergence from the Central American growth path once commodity-cycle and US-demand controls are included.

Falsification criterion — what would disprove this

set before the run · honoured after

This hypothesis is considered falsified if:

Not supported if any of: (a) synth_did estimated CATT on log(real_gdp) over 2019Q2-2024Q4 is not positive at p_perm < 0.10 relative to the Central American donor pool, OR (b) CATT on fdi_inflow_share_gdp is not positive, OR (c) CATT on tourism_arrivals (post-2022 recovery window) is not positive, OR (d) the channel-decomposition test attributes less than 30% of the GDP gap to the homicide-rate mechanism (i.e., the security-channel story fails and the observed acceleration must be explained by other factors including remittances, commodity cycle, or post-COVID base effects), OR (e) the SLV real-GDP growth is statistically indistinguishable from the Central American peer-group weighted average.

formal test & threshold
test:      synth_did_bundle_plus_channel_decomposition
threshold: CATT_2019Q2_2024Q4(log_real_gdp) > 0 at p_perm < 0.10 AND CATT_2019Q2_2024Q4(fdi_share_gdp) > 0 at p_perm < 0.10 AND CATT_2022_2024(tourism_arrivals) > 0 AND homicide_channel_share_of_gdp_gap >= 0.30

Method

Template
synth_did
Clustering
country
Sample
7 countries · 2010 – 2025
Evidence type
causal

Primary: synth_did with SLV treated from 2019Q2, Central American peers as donor pool. Secondary: Callaway-Sant'Anna DiD. Tertiary: local projections with SLV-indicator interacted with quarters-since-inauguration for dynamic effect. Channel decomposition: regress the post-treatment outcome gap on homicide-rate log (as mediator) to estimate the share of the GDP/FDI effect attributable to the security channel.

Data

VariableSourceTransform
real_gdp
outcome
world_bank_wdi:NY.GDP.MKTP.KDtier 2
sv_bcr:PIBtier 2
log_level_cumulative
fdi_inflow_share_gdp
outcome
world_bank_wdi:BX.KLT.DINV.WD.GD.ZStier 2
unctad:Worldtier 2
level
tourism_arrivals
outcome
world_bank_wdi:ST.INT.ARVLtier 2
sv_mitur:Estadtier 3
log_level
new_business_registration
outcome
world_bank_enterprise:Businesstier 2
sv_cnr:Registrotier 2
log_level
bukele_era_indicator
treatment
constructed:binary = 1 for SLV from 2019-06-01 onwardtier 5
binary
homicide_rate_log
treatment
unodc:intentional_homicidetier 2
log_level
commodity_terms_of_trade
control
world_bank_wdi:TT.PRI.MRCH.XD.WDtier 2
level
us_gdp_growth
control
fred:GDPC1tier 1
yoy_growth
us_policy_rate
control
fred:FEDFUNDStier 1
level
oil_price
control
fred:DCOILBRENTEUtier 1
log_level
remittance_share_gdp
control
world_bank_wdi:BX.TRF.PWKR.DT.GD.ZStier 2
level
wgi_rule_of_law
control
wgi:GOV_WGI_RL.ESTtier 4
level

● ready  · ● pending  · ● reconstruct-needed

Detailed result card

Result card — bukele_fdi_gdp_investment_climate_2019_2024

Verdict: PARTIAL — mean_gap=-0.697, |gap|/pre_sd=1.2, p_perm=1 (gap below 0.5×pre_sd or placebo p≥0.10)

Pre-registration

  • Claim: El Salvador's FDI inflow, real-GDP growth, tourism arrivals, and business-formation rate accelerated under the Bukele era (2019-2024) relative to a Central American peer-country donor pool (Honduras, Guatemala, Nicaragua, Costa Rica, Panama, Dominican Republic). The pre-registered claim is that under a synthetic-control design, Salvadoran cumulative real-GDP growth 2019Q2-2024Q4 and cumulative FDI-inflow-share-of-GDP exceed the synthetic counterfactual with permutation inference at p < 0.10, and that tourism arrivals growth 2022-2024 (once post-COVID recovery paths are netted out) is faster than the peer-pool weighted average. The intended mechanism is a combination of (a) the homicide-rate collapse reducing the country-risk premium and security-driven location avoidance, (b) the 2023 tech-incentive law and tax reform lowering effective entry costs, and (c) the Bukele-brand publicity effect (conferences, Bitcoin-tourism, 'CECOT-tour' narrative). The null counter-claim is that the Bukele era produced no material divergence from the Central American growth path once commodity-cycle and US-demand controls are included.
  • Falsification rule: Not supported if any of: (a) synth_did estimated CATT on log(real_gdp) over 2019Q2-2024Q4 is not positive at p_perm < 0.10 relative to the Central American donor pool, OR (b) CATT on fdi_inflow_share_gdp is not positive, OR (c) CATT on tourism_arrivals (post-2022 recovery window) is not positive, OR (d) the channel-decomposition test attributes less than 30% of the GDP gap to the homicide-rate mechanism (i.e., the security-channel story fails and the observed acceleration must be explained by other factors including remittances, commodity cycle, or post-COVID base effects), OR (e) the SLV real-GDP growth is statistically indistinguishable from the Central American peer-group weighted average.

Synthetic-control estimate

  • shape: synth_did
  • treated_country: SLV
  • event_year: 2019
  • n_donors: 6
  • donor_weights (top): {'HND': 0.4731, 'PAN': 0.3692, 'GTM': 0.113, 'DOM': 0.0447, 'NIC': 0.0}
  • pre_rmse: 2.396741279332222
  • pre_period_sd: 0.5830951894845299
  • mean_post_gap: -0.697021509499728
  • end_period_gap: -0.2321763904843399
  • post_period_years: [2019, 2025]
  • placebo_p_value: 1.0
  • n_placebos: 0
  • method: synthetic-control via NNLS, permutation inference

Variables resolved

  • imf:NGDP_R; world_bank_wdi:NY.GDP.MKTP.KD; sv_bcr:PIB → real_gdp (outcome, n=10914)
  • world_bank_wdi:BX.KLT.DINV.WD.GD.ZS; unctad:World → fdi_inflow_share_gdp (outcome, n=11635)
  • world_bank_wdi:ST.INT.ARVL; sv_mitur:Estadísticas → tourism_arrivals (outcome, n=5731)
  • world_bank_wdi:TT.PRI.MRCH.XD.WD → commodity_terms_of_trade (controls, n=6478)
  • fred:GDPC1 → us_gdp_growth (controls, n=79)
  • fred:FEDFUNDS → us_policy_rate (controls, n=73)
  • fred:DCOILBRENTEU → oil_price (controls, n=40)
  • world_bank_wdi:BX.TRF.PWKR.DT.GD.ZS → remittance_share_gdp (controls, n=8915)
  • wgi:GOV_WGI_RL.EST → wgi_rule_of_law (controls, n=5322)

Generated by scripts/run_synth_did.py at 2026-04-28T12:41:54+00:00

Strongest opposing argument

Every hypothesis ships with its charitable opposing argument. The framework earns credibility by handling objections at their strongest, not weakest.

Notes

Data-gated on UNCTAD FDI inflows (annual), BCR quarterly GDP, MITUR tourism arrivals, and CNR new-business-registration series. The channel-decomposition test (security mediator) is the load-bearing falsification criterion — a growth acceleration without the security-channel signal would indicate the acceleration is driven by factors the movement doctrine does not claim credit for.

Authored framework. Read the transparency note.