Interesting data from Dane Stangler indicates that the immediate postwar era was more entrepreneurial than people generally realize:
Let’s start with the most basic empirical information: the number and rate of new business formation. When the Census data cited above are expressed in per capita terms, the apparent doubling of firm formation disappears: the population doubled, bringing new business creation along with it without a corresponding increase in the rate. Indeed, we have published two papers on the puzzle of relatively steady levels of entrepreneurship in the United States, both across the past thirty years (the purported period of extreme entrepreneurship) and, potentially, across the entire twentieth century. In fact, firm formation fell from the 1980s to the 1990s and then flattened, neither falling nor rising. Per capita rates of new business formation today are actually quite similar — and certainly no higher — to those in the 1940s and 1950s, the ostensible high tide of bureaucratic capitalism.
It strikes me that asking “why do people start new businesses?” is one of these things where it might be easy to overemphasize the role of policy changes and underemphasize some other kind of more demographic or sociological factors.