The high failure rates of business start-ups and low average returns of self-employment suggest that too many people become entrepreneurs. Part of this excess market entry is thought to result from overconfidence in future entrepreneurial success: it is argued that entrepreneurs are more prone to overconfidence than wage-workers. Establishing overconfidence as a driver of entrepreneurial activity using field data is challenging because statements about the relative level of overconfidence among entrepreneurs versus non-entrepreneurs ideally require representative population samples, and the direction of causality between occupational choice and self-perception is difficult to determine.
Rietveld, Cornelius A.; Groenen, Patrick J.F.; Koellinger, Philipp D.; van der Loos, Matthijs J.H.M.; and Thurik, A. Roy
"LIVING FOREVER: ENTREPRENEURIAL OVERCONFIDENCE AND SUBJECTIVE LIFE EXPECTANCY (SUMMARY),"
Frontiers of Entrepreneurship Research: Vol. 33
, Article 16.
Available at: https://digitalknowledge.babson.edu/fer/vol33/iss5/16