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The Entrepreneurship Myth

Author Scott Shane seeks to dispel popular illusions about startupsstarting with the myth that founders earn more than they would as employees

Entrepreneurship creates jobs and drives the U.S. economy, making smart founders and savvy investors rich in the process, right? Not so, says Scott Shane, professor of entrepreneurial studies at Case Western University and author of The Illusions of Entrepreneurship, to be published by Yale University Press this month.

Shane argues that increasing the rate at which new companies are formed does little for the economy or job growth; instead, expanding existing businesses would be a more efficient way to spend time and money. Shane, who is also a researcher on new businesses for the Ewing Marion Kauffman Foundation and an angel investor with the Cleveland-area North Coast Angel Fund, wants to give every aspiring business owner a reality check.