What Nurtures Confident Entrepreneurs?

04/09/2015 04:33 pm ET | Updated Jun 09, 2015


I had a pretty ordinary childhood until I was 8. In the space of two years, it all fell apart. My parents divorced, four family members died, and to top it all off, my dad committed suicide.

Needless to say, my mom and I were in trouble. But there was an actor willing to help out: the German state. That not only meant free books and school trips. It also meant we were able to afford a real, albeit ancient and totally out-of-tune, piano.

In retrospect, that piano probably saved my life. It allowed me to discover my passion for music and to play in the school orchestra along with the lawyers' kids and the doctors' kids.

Two years before the end of high school a charismatic entrepreneur spoke at our class. His message: succeeding in life is all about making the right market choices - choices that leverage your talent. This statement left a huge positive impression on me. So I thought about what talent I had. I was very good at making music and so I started my own record label.

Another two years and several records later, I could afford to enrol with Germany's most prestigious private university. Soon after, I went to Chicago to study marketing at Northwestern University. One thing led to another. And by the time I was 27, I had my PhD. Since then, I have published countless papers, won many awards, earned tenure, worked with some of the world's most successful business leaders, and taught hundreds of really inspiring students. In fact, I have become a bit of a poster child for an entrepreneurially based model of scholarship.

After all, it seems that this entrepreneur was right: succeeding in life is all about making the right market choices - choices that leverage your talent. Except: he is not. I would not be where I am today if, at one point in my life, I had not been a social welfare kid.

To be sure, as an economist by training, I love markets and I study them everyday. Markets can serve a number of important purposes such as leveraging talent. But when it comes to nurturing talent, nothing beats the welfare state.

As a German child of the Helmut-Kohl era, my childhood experience was still very much influenced by such a political-economic arrangement - and of course by the idea that entrepreneurship is good. But the political climate that shaped my existence didn't categorically equate "support" with "lazy and entitled" or transform all questions about social equality into individualized talks about struggling for equity.

And that's one significant difference between my childhood and the childhood of kids who are in similarly precarious situations today.

Last week, the door bell rang. And a group of junior entrepreneurs made a clever business proposition: you get our homemade cookies and song and dance performance in exchange for a monetary donation towards school books. How cute! And also how shameful! I was selling lemonade on the sidewalk - not for school books but for fun. Dancing was for impressing girls, not for sustaining my education. And how would my single mom have felt about having to provide cookie currency on top of dealing with an already complicated life situation?

Today institutions render these practices as opportunities for self-realization, self-improvement, self-empowerment, self-transformation, self-regulation, etc. This idea of plugging any sense of self right into the market logic of optimizing one's own enterprise performance literally starts in kindergarten. While this relieves government and business of many duties, wouldn't the better investment be to nurture these kids' "selves" first, in an environment characterized mainly by formal protection, and then bring them to market?

I'd love to see these kids again in ten years running their own companies or branding themselves like mavericks - after they had a fair chance to discover if they want to be artists, writers, teachers, nurses, architects, or scientists. In the end, markets are very important - and so are states. But the best producer of confident entrepreneurs is probably not the market. It's the state.