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Abstract
This study investigates the impact of global value chain (GVC) participation and female leadership on firms' innovation capabilities. Employing a recursive bivariate probit model to address endogeneity concerns, the findings reveal a positive and statistically significant relationship between GVC participation and firm innovation. Notably, female leadership serves as a key driver of innovation, particularly in firms deeply integrated into GVCs. These insights underscore the necessity of reducing trade barriers, implementing R&D support policies, and fostering an inclusive environment for women in leadership roles. The study also suggests future research directions, emphasizing the need to explore organizational and marketing innovation to provide a more holistic perspective on firms’ innovation dynamics.