This paper estimates the role of both tax and non-tax determinants in the choice in Sweden to be a closely …-income individuals face relatively neutral incentives, higher income individuals face strong tax incentives to be corporate. The data … suggest a relatively strong correlation between these tax incentives and the likelihood that a firm is corporate. Many …

) family firms are considered to be the backbone of the economy. We find that family firms have significantly lower leverage … ratios than non-family firms, independent of the definition of leverage applied. Among the three dimensions of a family firm …, management board involvement by the founding family has a consistently negative influence on leverage across all our models. In …

firms rely heavily on equity financing, even though benefits associated with debt (like tax shields) appear to be high and …. Debt, however, has an adverse effect on the enforceability of these arrangements because too much debt increases the firm … analysis provides an explanation for why some firms only use little debt financing. Predictions made by our theory are in line …