Organizational Capacity, Resource Environment, and Revenue Diversification Among Chinese Nonprofit Organizations

Abstract Although the outcomes of nonprofit revenue diversification have been widely studied, its antecedents remain underexplored. This study applies resource dependence theory to examine the factors shaping nonprofits’ revenue diversification strategies, drawing from a nationwide survey of Chinese social service nonprofits. The findings indicate that, on average, Chinese nonprofits tend to have less diversified revenue portfolios, though significant variation exists across organizations. The analysis reveals that nonprofits with a well-established professional workforce and those operating in resource-rich environments are more likely to concentrate their revenue sources. In contrast, nonprofits with stronger government ties are more likely to have diversified revenue structures. These findings offer new insights into the literature and carry practical implications for nonprofit management.