You could get rich from starting your own company in 1890 and in 2020, but in 1960 it was not really a viable option. You couldn’t break through the oligopolies to get at the markets. So the prestigious route in 1960 was not to start your own company, but to work your way up the corporate ladder at an existing one.
He concludes,
It’s easier now to start and grow a company than it has ever been. That means more people start them, that those who do get better terms from investors, and that the resulting companies become more valuable. Once you understand how these mechanisms work, and that startups were suppressed for most of the 20th century, you don’t have to resort to some vague right turn the country took under Reagan to explain why America’s Gini coefficient is increasing.
Pointer from Tyler Cowen.
It’s easier now to start and grow a company than it has ever been. That means more people start them, that those who do get better terms from investors, and that the resulting companies become more valuable.
I am not an economist, and in fact have not really studied economics at all, so this may be a dumb question. I’m okay with that. 🙂
Isn’t this is the opposite of what you’d expect to happen? As we get more and more of something, doesn’t that thing become less valuable?