Both codes provide methods for identifying countries within the dataset. Both iso3 and dynamic_code (combined with year) uniquely identify records. The iso3 variables use the standard International Organization of Standards (IOS) ISO alpha-3 codes and are likely the most useful identifier for most purposes, such as merging with Comtrade data. The dynamic_code variables provide a slight refinement to the ISO codes by tracking situations in which countries undergo a significant alteration to their geography and composition but retain the same ISO code. In these cases (such as Pakistan's split into Pakistan and Bangladesh), the dynamic_code notes this change by altering the code to reflect the difference (post-split Pakistan is given the dynamic_code "PAK.X").
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What is the difference between the identifiers iso3 and dynamic_code in the Gravity dataset?