Document Type : Research Paper


1 Faculty member of Isfahan University

2 PhD student in Economics, University of Isfahan


Today, phenomenon like globalization, regionalism and trade blocks' are the basic issues which bring many positive consequences to the world economy. Among all, it would impress foreign transactions, increase the amount of trade flows, achieve the competitive capability and improve it, removes the tarrif and non-tarrif barriers and acquiring the binding conditions for a presence in the "World Free Trade".
Regionalism and trade blocks are one of the ways that developing countries can adopt to collate the globalization process. To acknowledge their own abilities or, to settle the commercial and economic disputes in their regions by using their comparative advantages, and getting the inherent readiness to merge to the world economywith a more extensive process.
In this paper, in addition to review the process of globalization, regionalism and their effects on domestic and international economies, it also recalling some literatures and evidences on this basis and examines the most proper trade arrangements and economic convergence for the selected Middle East countries by utilizing the "Gravity Model" and it's estimation on "Panel Data" method.
Gravity models with Panel Data method, on the basis of using variables such as (GDP), economic structure, population, geographic situation, cultural contributions and per capita income.
The results show that economic integration amongECO and D-8 countries could increase the value of trade and create opportunities for more exports and imports.
GDP has a positive effect on trade while geographical distance has a negative sign and shows that it has no effect on Iranian's bilateral trade and there is no sigii of trade bias.