SNOW: a general equilibrium model of Structural Network Organization of theWorld economy

We introduce SNOW (Structural Network Organization of the World economy), a next-generation quantitative trade model, network-based general equilibrium framework designed to capture the complex propagation of shocks through global value chains (GVCs). Unlike existing models, SNOW integrates micro-founded selection of products at the input-output level, country-and product-specific CES technologies with fully endogenous input cost shares, and a four-dimensional representation of trade barriers and policy shocks that vary by origin, destination, sourcing sector, and using sector. By preserving the full nonlinear structure of general equilibrium responses, SNOW can simulate large shocks and conduct structural counterfactual analysis of policy. By treating the observed input-output network as the equilibrium outcome of an underlying production system, SNOW provides a counterfactual data-generating process for GVCs, allowing shocks to trade costs, technologies, and policies to generate counterfactual endogenous responses in production, input sourcing, trade, and value added.