Comparing the Economic Convergence of Iran with South East and South West Asia Countries with an Emphasis on Synchronization of Business Cycles

Regarding the widespread and close competition inside the new atmosphere of global trade, forming business blocks can contribute a lot to increasing the competitive capability of countries. Accordingly, in the current study in order to compare the economic convergence of Iran with the countries located in South East and South West Asia, two models including generalized gravity model and spatial econometric model are utilized separately. The obtained results indicate the economic convergence between Iran and countries in South East and South West Asia. Regarding the countries in South East Asia there is no significant convergence. Hence, the economic convergence of Iran with the countries of South East Asia should nob a priority. According to the results, the business cycles synchronization variable does not have a significant impact on bilateral trade procedure.