Pursuing the American Dream

Many of the world’s richest individuals obtained their fortune through entrepreneurship (or inheritance from entrepreneurs). The powerful narrative of the ‘American Dream’ posits that even individuals born into poverty can raise to great wealth thanks by starting successful firms. But does the narrative of the American Dream indeed rally local entrepreneurship and induce upward economic mobility? This project draws on a long time series of newspaper articles that are recorded at the U.S. Library of Congress to build a database on published stories about the American Dream and relates news stories to evidence for local entrepreneurial activity. To take a step towards a causal interpretation (narrative to entrepreneurship), it will consider instrumentation strategies that exploit variation in access to media, for instance through a staggered spread of internet access in more recent periods. Further analysis will seek to investigate which types of narratives about the American Dream attract which demographic groups into entrepreneurship. In particular, stories of entrepreneurship and the American Dream variably emphasize a meritocratic production narrative (“work hard to generate income”) or a consumption narrative (“use income to consume more”). The project will also consider how the propensity to enter entrepreneurship is affected by public policies such as the staggered phase-out of the state-level estate inheritance gift taxes.