Abstract:This paper first constructs a theoretical model of trade network including three-country scenario to examine the effects of trade costs and third-country effects on trade network status, and then uses global value-added trade data from 2003 to 2018 to conduct an empirical test. The results show that the position of each country in the global value-added trade network shows a non-homogeneous distribution of“high minority, low majority”and“dynamic evolution, rise and fall”pattern, with Germany, China and the United States playing the role of core countries; the reduction of bilateral trade costs will promote a country’s status. With the shift of trade network status to the higher quartile, the impact of trade costs among third countries will gradually shift from trade transfer to trade creation. Further decomposition of trade costs reveals that the marginal contribution of trade facilitation is stronger than that of trade liberalization, among which the contribution of e-commerce and institutional environment facilitation is relatively stronger. This paper clarifies the mechanism between trade costs and trade network status, and also provides a reference for enhancing the international division of labor status of developing countries and promoting China to become a trade power.