Entrepreneurship is an important part of a thriving economy, and entrepreneurship education is intended to make sure that those who have the potential to succeed in this way have the resources and knowledge to do so. But the opportunity for innovation, being one's own boss, and making money are not the only reasons that people become entrepreneurs. Some do so to fulfil a kind of fantasy, or simply to look good. And there is an entire educational sub-industry offering to help them to indulge this fantasy, for a price.

In Towards an "Un"trepreneurial Economy: the Entrepreneurship Industry and the Veblenian Entrepreneur, authors Hartmann, Spicer, and Krabbe try to explain a strange trend in recent years: while entrepreneurial activity has gone up, success rates for entrepreneurial ventures have gone down. After considering several possible explanations, they ultimately conclude that a major reason for "excess entry" into what one might call "high-class" entrepreneurship (e.g. founding a tech start-up) is due to a sub-class of entrepreneurs who are not driven to pursue real opportunities in the market, but are simply trying to adopt the identity of an entrepreneur because of its high social status. Dubbed "Veblenian entrepreneurs" (or sometimes "wantrepreneurs") after Thorstein Veblen, the sociologist who coined the term conspicuous consumption at the end of the 19th century, these are individuals who are drawn in by a huge industry designed to sell people a dream and a lifestyle which can take them away from everyday mundanity and make them seem successful to their peers. Consumers of the entrepreneurship industry's products (such as courses, conferences, publications, and consultancy) have been shown to engage in more entrepreneurial activity, while actually having lower success rates.

This idea is somewhat analogous to the notion of human capital vs. signalling in education economics - in other words, what is the value of education? Does it make you a better and more productive person, or does it just make you look good to employers? (What is the value of entrepreneurship? Does it contribute to the economy, or does it just make you look good on social media?) It also has implications for entrepreneurship educators. Should we really be encouraging entrepreneurship for everybody who is interested, or should we be discouraging those who are least likely to succeed, so that they can make better choices?

Enjoy the episode.

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