"Surfeiting, the appetite may sicken": Entrepreneurship and the happiness of nations

We know that entrepreneurs - at least those driven by opportunities - can contribute to economic growth, productivity improvements and competitiveness in national economies.. But do they contribute to happiness on the country level? In other words, does the happiness of nations depend on its entrepreneurs? And what about happy nations - are they better places for entrepreneurs to start-up new businesses? In this paper we survey the literature on entrepreneurship and happiness, and use various data sources, including from the Global Entrepreneurship Monitor, to find tentative evidence of an inverse U-shape relationship between (opportunity) entrepreneurship and national happiness. We find little evidence that a nation's happiness drives early-stage entrepreneurial activity but we do find evidence that opportunity-motivated entrepreneurs in happier nations may be less concerned with high firm growth. Thus we conclude that opportunity-motivated entrepreneurship may contribute to a nation's happiness, but only up to a point. Not everybody should become entrepreneurs, and the happiness of a nation cannot be indefinitely increased by boosting the numbers of opportunity entrepreneurs.