Editor's Note: This is a guest blog post authored by Lina Khan, program associate with New America's Markets, Enterprise and Resiliency Initiative.
If there’s one thing Americans have faith in it’s the country’s entrepreneurial verve. Even amid high unemployment and a tepid economic recovery, we generally believe that strong entrepreneurship and upstart businesses will help steer us out of our present ditch. Media reports and sparring politicians fixate on this crucial sector of the American economy, a source of new products, new ideas, new jobs, and new wealth.
An article published today shows that America’s entrepreneurial sector is actually in deep crisis. The piece, written by Barry C. Lynn and myself in the forthcoming issue of the Washington Monthly, shows that for over a generation fewer Americans have been creating new businesses. The nation’s self-image notwithstanding, the number of new entrepreneurs – measured per capita – declined by 53 percent between 1977 and 2010. Even the share of self-employed Americans has fallen, dropping by more than 20 percent between 1991 and 2010.