LAUSR

Abstract Chinese governments, driven by both pragmatic and legitimacy purposes, have been enthusiastically engaging social organizations in service contracting to meet rising service demands. This article argues that social organizations’ participation in contracting is shaped by their dual identity as state agents and social actors. Such a dual identity is forged by China’s institutional environment and its internal tension may create both incentives and disincentives for contracting. Using the data from the competitive contracting for the social service program in Shanghai (2009–2013), the article finds intriguing evidence that both identities had positive influences on social organizations’ participation. Social organizations actively participated to demonstrate loyalty and manage their relations with government, as well as to seek new resources, social visibility and professional capacities. They reconciled the two identities by adopting multiple strategies. Further analysis reveals how contracting has been adapted to the social-administrative system in China.