As countries with close political, cultural and historical relationships are likely to trade more with each other than normal and
these country-pair factors may have a significant impact on the level of bilateral trade between these two countries, but not with third countries, researchers have attempted to incorporate as many relevant dummy variables as possible in the model to represent these bilateral ties so as to obtain an unbiased estimation. However, as so many unobservable dyadic factors
remain, the choice of specific country-pair fixed variables is always an intractable problem in empirical studies.