Relationship between biomass energy and economic growth in transition countries: panel ARDL approach

Abstract In this study, we have investigated the co‐integration and causality relationship between the biomass energy consumption and economic growth in the transition countries by the Panel Auto Regressive Distributed Lag ( ARDL ) method and Pedroni co‐integration analysis for 1990–2011. Analysed countries are gathered under two groups. For Groups 1 and 2, Pedroni panel co‐integration test and ARDL bound test results show that biomass energy consumption and economic growth are co‐integrated. Fully modified ordinary least squares results suggested that biomass energy consumption has positive effect on the economic growth.