In this era of modernization & globalization, corruption has been regarded as root cause of stagnant economic growth and poor human development in the developing countries. Almost all of the International donor agencies particularly IMF and the World Bank have introduced and are implementing the anti-corruption polices through their structural adjustment programs. Good governance and devolution are now considered necessary for the economic development of any country. The literature on this subject strongly supports the existence of mutually inter-dependent relationship between corruption, growth and human development. With this background this paper is an attempt to explore empirically the existence of this relationship for SAARC countries including Pakistan, India, Bangladesh and Sri Lanka. As growth is one of the major components of Human Development Index it is expected that higher degree of corruption will lead to lower level of Human Development. For this purpose panel co integration technique will be used for the data of period 1995-2006. To the best of our knowledge this has not been done before.
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Copyright (c) 2012 Roohi Ahmed