I would say corporations are a creature of the tax system, at least in part. When individuals trade, every transaction is taxed. When people in a corporation trade, its not taxed until the results are traded with some other entity. There is some incentive to get under an organizational umbrella.

There are other agents in the free market other than corporations. Anyone that is working for one is actually agent in the free market. They trade their labor with the corporation and the cash they get with hundreds of other agents.