D-instanton and polyinstanton effects from type I' D0-brane loops

We study non-perturbative D(-1)-instanton corrections to quartic gauge and curvature couplings in 8d type IIB orientifolds, in terms of a one-loop computation of BPS D0-branes in T-dual type I' models. The complete perturbative and non-perturbative results are determined by the BPS multiplicities of perturbative open strings and D0-brane bound states in the 9d type I' theory. Its modular properties admit a geometric interpretation by lifting to Horava-Witten theory. We use the type I' viewpoint to motivate a proper interpretation of 8d and 4d polyinstanton effects, consistent with heterotic - type II orientifold duality.