VfS Annual Conference Reinhard Selten Award

Taxing Business Profits or Business Wealth – Does It Make a Difference?

In his award-winning research paper, “Taxing Business Wealth or Profits: Evidence from German Wealth Taxation,” David Gstrein uses a major German tax reform as a natural experiment. The results are remarkable: A larger reduction in the taxation of business wealth led to significantly higher investment and rising wages.

The study thus provides important insights for the current tax policy debate: It makes a crucial difference whether business wealth or business profits are taxed.

For the German context examined, the analysis shows that, under plausible assumptions, a tax on profits entails lower welfare costs than a tax on the book value of business wealth.

An exciting research contribution at the intersection of academic research and tax policy – and a well-deserved award.

Congratulations to David Gstrein on receiving the 2026 Reinhard Selten Prize, and a big thank you to the entire 2026 Program Committee, chaired by Conny Wunsch (University of Basel).

The Reinhard Selten Prize is endowed with €3,000 and was presented by Conny Wunsch at the VfS Annual Conference at the University of Innsbruck.

Further information about this VfS award can be found here.