Institutional quality refers to the effectiveness and reliability of organizations and systems that govern a society, including government agencies, judicial systems, and regulatory bodies. High institutional quality ensures that laws are enforced fairly, public services are delivered efficiently, and corruption is minimized, leading to a stable environment for economic and social development. Factors influencing institutional quality include transparency, accountability, and rule of law. Strong institutions promote trust among citizens and businesses, encouraging investment and participation in the economy. Conversely, weak institutions can lead to instability, inefficiency, and a lack of public confidence in governance.