Identifying appropriate trade policies for Expansion of intra industry trade

The purpose of this study is to explain the appropriate Trade policies through understanding the intra-industry trade relations of the selected countries. While considering bilateral and multilateral trade relation, 20 countries were selected to investigate the nature of trade relationship between them in short and long run.  For the purpose of this paper a dynamic  panel data was estimated for the  2001-2015. Contrary to the results of the Goldstein-Khan study,  The results indicate that the  elasticity of trade with respect to other countries output   is lower in short run  than the long run elasticity. The results also indicate that the effect of the real exchange rate on multilateral export is greater than on the multilateral import. The impact of the GNP change of exporting and importing countries on expansion of  trade between  countries is the same. Finally, the results did not confirm the  phenomenon j  in  the equation of nominal trade balance.