incorporated firms to hire capital.This paper makes this point with a simple, capital-less model featuring entrepreneurs, with … entrepreneurs to diversify their assets. In discouraging incorporation, the corporate tax taxes business risk-sharing, keeping more … entrepreneurs private and, thus, exposed to more risk. The added risk experienced by these entrepreneurs limits their demands for …

justification for this pattern based on adverse selection that entrepreneurs face in credit markets. Individuals choose between … becoming entrepreneurs or workers and differ in their skill in both of these occupations. I find that endogenous cross …

entrepreneurs have fixed-time endowments to run their daily operations. As firms grow larger, the need to delegate decision …