The Bureaucratic Paradox of Citizen Agency: Institutional Crowding‐Out in Government‐Catalyzed Co‐Production in Shanghai, China

ABSTRACT

Public service co‐production is often framed as a means of creating public value, yet its dynamics are complex when citizen‐led participation is catalyzed by strong public institutions. This mixed‐methods study examines government‐catalyzed, citizen‐centric co‐production in Shanghai, China, where the state provides institutional support, policy legitimacy, and infrastructure while citizens undertake much of the work of deliberation, coordination, and implementation. Drawing on 246 interviews and survey data from 1476 residents involved in community new infrastructure projects, we examine how citizen trust, public‐service‐oriented motivation, and perceived co‐production efficacy are associated with process and outcome value creation, and how perceived institutional settings condition these relationships. The findings show that citizen cognitive factors are positively associated with value creation, while stronger perceived institutional settings can negatively moderate these relationships. Recursive qualitative analysis suggests two mechanisms that help interpret this pattern: formal rigidity may crowd out citizen agency in the co‐production process, while informal social density may generate lock‐in effects that weaken the translation of trust into substantive outcomes. The study contributes to co‐production and institutional theory by specifying the boundary conditions under which institutional support becomes over‐institutionalization. Effective co‐production requires not less government, but strong enabling support at the initiation stage combined with greater local discretion, participatory rule revision, and flexible enforcement.