Abstract

This study aims to examine the effect of absorption capacity and self-efficacy on knowledge sharing behavior in improving the SMEs’ innovation capability. The sample of this study was 106 SMEs in Central Java. Primary data collection is done by using questionnaire and interview instruments. The results showed that absorption capacity had a significant effect on knowledge sharing behavior and innovation capability. In addition, self-efficacy has a significant effect on knowledge sharing behavior and innovation capability, while Knowledge sharing behavior has a significant effect on innovation capability.

Keywords: Absorption capacity
Self-efficacy
 Knowledge sharing behavior
Innovation capability
SMEs