the sidebar.php shows
<li>
<?php wp_list_categories('show_count=1&title_li=<h2>Categories</h2>'); ?>
</li>
so which php file generates the Categories in the sidebar (wrapped in a tags and with number of posts)?
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The function is located inside wp-includes/category-template.php
You can find out where any function is located by looking at the WordPress codex – at the bottom of each page, there is a link to where the function located.
Documentation for wp_list_categores
wp_list_categories function source code