Int. J. Education Economics and Development, Vol. 1, No. 2, 2009 179 Copyright © 2009 Inderscience Enterprises Ltd. Is there any causality between human resource development and economic growth? A provincial case study on Pakistan Muhammad Shahbaz* COMSATS Institute of Information Technology, M.A. Jinnah Building Defence Road, Off Raiwind Road, Lahore, Pakistan Fax: +92 (42) 9203100 E-mail: villager@hotmail.com *Corresponding author Naveed Aamir Social Policy and Development Centre, House No.15, Maqbool Cooperative Housing Society, Block 7/8, Karachi, 75400 Pakistan Fax: 092214534285 E-mail: naveedaamir@spdc.org.pk Shaista Alam Applied Economics Research Centre, University of Karachi, Karachi, 75270 Pakistan Fax: (021)-9261545 E-mail: shaista_aq@yahoo.com Abstract: The present study aims to investigate the causality between economic growth and human resource development. In doing so, LLL (Larsson et al., 2001) panel co-integration rank test for heterogeneous panel models and recently developed panel causality tests by Hurlin and Venet (2001) are employed on panel of four provinces. The results of panel rank tests indicate that there exists a long run relationship between human resource development and economic growth in Pakistan. The results based on panel homogeneous causality hypothesis show that economic growth does not cause human resource development, while human resource development causes economic growth. However, panel non-homogeneous hypothesis suggest that there exist bi-directional causality relationship between human resource development and economic growth in Pakistan. The empirical evidence of heterogeneous causality hypothesis confirms the existence of bi-directional casual relationship between human resource development and economic growth in Punjab, while human resource development causes economic activity in Sind. Keywords: economic growth; human resource development; Pakistan. Reference to this paper should be made as follows: Shahbaz, M., Aamir, N. and Alam, S. (2009) ‘Is there any causality between human resource development and economic growth? A provincial case study on Pakistan’, Int. J. Education Economics and Development, Vol. 1, No. 2, pp.179–200.