The impact of violence, corruption, and key economic indicators on GDP in SAARC countries: 2000–2022 period

Political violence, corruption, and institutional weaknesses are widely recognized as major obstacles to sustainable growth in developing economies. This study aims to analyze the impact of political violence, corruption, and key macroeconomic indicators on economic growth in the member countries of the South Asian Association for Regional Cooperation (SAARC) during the period 2000–2022. The research investigates the short- and long-term effects of political stability, control of corruption, public debt, current account balance, unemployment rate, and globalization level on GDP per capita through a multidimensional panel-data approach. Methodologically, the study employs first- and second-generation panel unit-root tests, the Johansen-Fisher panel cointegration test, the Vector Error Correction Model (VECM), Fully Modified Ordinary Least Squares (FMOLS), Dynamic Ordinary Least Squares (DOLS), and the Panel Vector Autoregression (PVAR) model. Empirical findings reveal that long-term economic growth in SAARC countries is shaped primarily by political stability, institutional quality, and the degree of global integration. Political stability and globalization exert significant positive effects on growth, whereas corruption, unemployment, and high public debt negatively affect economic performance. Country-specific results indicate that Bhutan and the Maldives, characterized by low corruption and strong governance structures, achieved the highest growth rates, while Afghanistan and Pakistan, suffering from institutional fragility and pervasive corruption, recorded the weakest outcomes. Overall, the results empirically confirm that sustainable economic growth in the SAARC region depends not only on sound macroeconomic policies but also on effective governance, institutional transparency, and the strengthening of political stability.