Organizational-form choice and tax incentives: Multi-country evidence

Research output: Contribution to journalArticleScientificpeer-review


We study how differential taxation of personal and corporate income impacts the corporate share of new firms for 31 countries over 1998–2018. We build a novel database that identifies the tax treatment of partnerships either as corporations or as passthrough entities. We find a tax elasticity of 0.07 for the period 1998–2007 and of 0.12 for 2008–2018. Estimates are larger for countries where the presence of partnerships is nonnegligible and where they are treated as passthrough for tax purposes, suggesting that the tax sensitivity of organizational-form choice interacts with the relevance of partnerships and their tax treatment.
Original languageEnglish
Article number2
Pages (from-to)247-286
JournalFinanzarchiv : Zeitschrift fuer das gesamte Finanzwesen
Issue number3
Publication statusPublished - 18 Oct 2021


  • corporate income tax
  • personal income tax
  • organizational form
  • partnerships


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