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Purpose This paper aims to investigate how knowledge sharing influences technological innovation capability (TIC) of the software small- and medium-sized enterprises (SSMEs). Design/methodology/approach Based on the theories regarding knowledge management, TIC, software engineering and open innovation, this paper constructed a research model comprising factors affecting knowledge sharing, knowledge sharing and TIC, and then tested the model quantitatively. The study focuses on SSMEs in China collecting 457 online questionnaires and uses a structural equation model to test the hypotheses. Findings The knowledge sharing culture, organizational structure, middle-level leadership and management system have significantly positive effects on tacit knowledge sharing; management system and IT support have significantly positive effects on explicit knowledge sharing; both explicit and tacit knowledge sharing have significantly positive effects on TIC. Research limitations/implications The study enriches the research on knowledge sharing and TIC. However, it does not consider factors affecting knowledge sharing at the non-organizational level or the interaction between explicit and tacit knowledge sharing. Practical implications The study offers several recommendations/suggestions for helping SSMEs to promote and implement explicit or tacit knowledge sharing and TIC. Originality/value This paper examines the impact of knowledge sharing on TIC from the perspective of knowledge management deconstructing knowledge sharing from the epistemological dimension and the TIC of software companies on the basis of software engineering theory. It provided a new theoretical perspective for the research of knowledge management and technological innovation management in SSMEs.

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