This entire thread is the most amazing Rorsach test, on the basis of the flimsiest data. Many of the points made in the comments may be true, but it&#x27;s a disappointing for a HN thread to have so much impassioned comment but so little critical analysis of the underlying data.<p>The first issue worth noting is that the definition of &#x27;employed&#x27;(not discussed in the article or the original paper) vs self-employed incorporated vs self-employed non-incorporated are based on self-reporting from the census [5]:<p>&quot;CURRENT OR MOST RECENT JOB ACTIVITY. Describe clearly this person’s chief job activity or business last week. If this person had more than one job, describe the one at which this person worked the most hours. If this person had no job or business last week, give information for his&#x2F;her last job or business.<p>Mark (X) ONE box. 
- an employee of a PRIVATE FOR-PROFIT company or business, or of an individual, for wages, salary, or commissions?  
... several other answers elided...
- SELF-EMPLOYED in own INCORPORATED business, professional practice, or farm?
- SELF-EMPLOYED in own INCORPORATED business, professional practice, or farm?&quot;<p>So if you are getting a salary from your startup, do you think there might be some ambiguity about which one you tick? If you are working at company A, but working on your startup on evenings and weekends, you would mark &#x27;employed&#x27; if you followed the instructions.<p>Once you understand where the data came from, you might not infer the same meaning to the underlying paper, whose abstract is here:
&quot;We disaggregate the self-employed into incorporated and unincorporated to distinguish between &quot;entrepreneurs&quot; and other business owners. We show that the incorporated self-employed and their businesses engage in activities that demand comparatively strong nonroutine cognitive abilities, while the unincorporated and their firms perform tasks demanding relatively strong manual skills. The incorporated self-employed have distinct cognitive and noncognitive traits. Besides tending to be white, male, and come from higher-income families, the incorporated—as teenagers—typically scored higher on learning aptitude tests, had greater self-esteem, and engaged in more disruptive, illicit activities. The combination of &quot;smart&quot; and &quot;illicit&quot; tendencies as youths accounts for both entry into entrepreneurship and the comparative earnings of entrepreneurs. In contrast to past research, we find that entrepreneurs earn much more per hour than their salaried and unincorporated counterparts.&quot;<p>So they are using &#x27;incorporated&#x27; as a proxy for entrepreneur, by comparing them with &#x27;unincorporated self employed&#x27;. Let&#x27;s see if that makes sense, and if their &#x27;entrepreneur&#x27; is the same as what we might call a &#x27;startup founder&#x27;:<p>- The ratio of unincorporated to incorporated is 2:1 (approx 10 million vs 5 million in 2009 [1])<p>- The SBA says 600,000 new ventures are started each year (that they know about) [2]<p>- There are around 70000 angel deals in one year (2013) [3]<p>- There are about 4000 venture deals in one year (2014) [4]<p>We can probably agree that the angel and venture deals are &#x27;real&#x27; startup entrepreneurs. Some small indeterminate proportion of the incorporated and unincorporated self-employed probably are too. However, doesn&#x27;t it seem a little silly to analyze the 5 <i>million</i> incorporated self-employed vs the 10 <i>million</i> non-incorporated self-employed, and assume it&#x27;s telling you anything about <i>start-up entrepreneurs</i> ?<p>[1] <a href="http:&#x2F;&#x2F;www.bls.gov&#x2F;opub&#x2F;mlr&#x2F;2010&#x2F;09&#x2F;art2full.pdf" rel="nofollow">http:&#x2F;&#x2F;www.bls.gov&#x2F;opub&#x2F;mlr&#x2F;2010&#x2F;09&#x2F;art2full.pdf</a><p>[2] <a href="https:&#x2F;&#x2F;www.sba.gov&#x2F;sites&#x2F;default&#x2F;files&#x2F;FAQ_Sept_2012.pdf" rel="nofollow">https:&#x2F;&#x2F;www.sba.gov&#x2F;sites&#x2F;default&#x2F;files&#x2F;FAQ_Sept_2012.pdf</a><p>[3] <a href="http:&#x2F;&#x2F;www.angelcapitalassociation.org&#x2F;data&#x2F;Documents&#x2F;Resources&#x2F;ACA-AngelBackground2014.pdf" rel="nofollow">http:&#x2F;&#x2F;www.angelcapitalassociation.org&#x2F;data&#x2F;Documents&#x2F;Resour...</a><p>[4] <a href="http:&#x2F;&#x2F;nvca.org&#x2F;?ddownload=1868" rel="nofollow">http:&#x2F;&#x2F;nvca.org&#x2F;?ddownload=1868</a> (2015 NVCA Yearbook)<p>[5] <a href="http:&#x2F;&#x2F;www2.census.gov&#x2F;programs-surveys&#x2F;acs&#x2F;methodology&#x2F;questionnaires&#x2F;2015&#x2F;quest15.pdf" rel="nofollow">http:&#x2F;&#x2F;www2.census.gov&#x2F;programs-surveys&#x2F;acs&#x2F;methodology&#x2F;ques...</a><p>Edited to fix formatting issues