Abstract
This paper investigates the relationship between biomass energy consumption and economic growth for 26 OECD countries for 1980 to 2013 period. This study used panel unit root analyses, panel cointegration analyses, dynamic OLS analyses, fully modified OLS analyses and panel VECM Granger causality to examine the relationship. The results reveal the presence of long-run equilibrium relationship between the variables supporting the feedback hypothesis. As policy implication, OECD countries have to improve the biomass energy infrastructure as an important source of renewable energy to promote economic growth.
•Investigation of relationship between biomass consumption and economic growth.•Focus on 26 OECD countries for 1980 to 2013.•Feedback hypothesis is confirmed.•Policy suggestion: promotion of biomass will enhance economic growth.