139. Fabrice Testa on Super Entrepreneurship

Entrepreneurship is a method, and it’s also a mindset. Fabrice Testa has written a book that brilliantly integrates the two: he calls the integration “Super Entrepreneurship,” and his book title is therefore Super Entrepreneurship Decoded. He has the appropriate credentials as a proven super-entrepreneur who has created and nurtured numerous great companies (and successfully sold a couple of them).

Fabrice knows the true meaning of the phrase, “The day before something is a breakthrough, it’s a crazy idea”.

Entrepreneurs are animated by their purpose. Super entrepreneurs embrace a massive transformative purpose.

The motivation for entrepreneurs is to help others — to solve problems for others, as we sometimes phrase it. Super entrepreneurs, in Fabrice Testa’s language, are those who choose to dedicate their businesses to solving the biggest problems. By setting big goals, they attract many like-minded partners, collaborators, and employees. By targeting transformation, they aim to change the world in a significant way.

In making this choice, super entrepreneurs are delving deeply into their own personal story to understand their own drivers and their own passionate commitment. There’s a major self-discovery component.

Having set their MTP, super entrepreneurs develop a systematic approach to the pursuit of their goal.

Fabrice Testa recommends that super entrepreneurs combine what he calls CRAZY thinking with a relentless sense of purpose. CRAZY is an acronym for elements of entrepreneurship that Testa calls the Five Secrets. We agreed not to give them away, but they add up to a five-step method entrepreneurs can follow, and a checklist that they can use to assess the market power of their own concepts and business models.

The context for the 5-step method is the exponential rate of growth of available and applicable technologies for entrepreneurship, and the convergence of those technologies that results in a compounding of productivity. When, for example, sensor-based data collection can be combined with A.I. and robotics, whole new fields of automation open up, potentially helping billions of people.

A relentless sense of purpose is a major element in the super entrepreneurial mix.

Super entrepreneurs are highly motivated. They display high levels of ambition and drive, and they generate strong momentum. They seek change, and aim for breakthroughs. They love to set the bar high.

There is a spirit to super entrepreneurship, an intangible spark of super energy and boldness that sets the best entrepreneurs apart and powers them to unusual levels of achievement.

There’s a plan, but it’s not fixed.

Fabrice Testa identifies a master plan for the activities of high-achieving entrepreneurs, but it’s not the restrictive plan of the business school strategist. One term he used was Roadmap: there’s a goal to get from A to B, but it’s OK to visit C, D and E along the way, and to learn and double back and embrace recursive procedures to reach the targeted end-results. The key to success is keeping the goal in mind with flexibility on the route to get there.

Let the customer be the guide.

Testa subscribes to the protocol of involving the customer early and often in the process of designing and building a product or service or a company. Entrepreneurs are always working with assumptions, and, at minimum, must validate them with customers.

He introduced us to the “Starbucks method” of customer validation. Park yourself in Starbucks, order a beverage of your choice, then look around for likely-looking people who might be open to a brief conversation about your idea or proposal or even prototype. It’s easy to engage people, they’re willing to help, and you can offer to buy them a coffee to lubricate the relationship. A few hours investment of your time and a few dollars invested in coffee will result in a deep, broad and rich set of reactions and responses and a meaningful feedback loop.

Success is more about fitting in than it is about timing.

When writers and historians are trying to analyze the unusual success of a particular business, they often attribute a lot of the cause of the outcome to timing — the product or service or technology came along at just the right time. This is a misinterpretation. The happy correspondence of a new offering with a receptive context is not timing but fitting in.

According to Fabrice, to fit in in a big way is to fit in with the zeitgeist of the era. The dictionary definition of zeitgeist is the general intellectual, moral, and cultural climate of an era. What Fabrice is pointing towards is a heightened ability to sense the movement of the time, and the direction of its flow, and to step into that river at the right point.

Entrepreneurship is everywhere, and can be achieved at multiple scales.

Super entrepreneurship is not limited by the scale of resources, but it can certainly be augmented wherever resources are abundant. That’s why we seek to encourage entrepreneurship for individuals, teams, and firms of all size, including the largest corporations. Big companies under-perform at entrepreneurship for two reasons. First, they spawn bureaucracy, which is a form of organization that is counter-entrepreneurial. Second, they have existing businesses to defend and fear the consequences of self-disruption.

The solution is to change the purpose of big corporations so that they can become super-entrepreneurial. The purpose would be to create new businesses with no bureaucracy and separated from the defense mechanisms of existing business units or divisions.

Additional Resources

Super-Entrepreneurship Decoded: 5 Secret Keys to Create Breakthrough Businesses that Change the World by Fabrice Testa: Buy It On Amazon

“Super Entrepreneurship” (PDF): Download PDF

131. Saras Sarasvathy On The Entrepreneurial Method

The scientific method has served us well to date. The entrepreneurial method, informed by the principles of Austrian economics, can take society much further. Dr. Saras Sarasvathy joins the Economics For Business podcast to distill the essence of the value-generating and wealth-producing method.

Download our knowledge graphic for the Entrepreneurial Method.

There is an entrepreneurial method — a systematic way to achieve the unpredictable.

The scientific method aims to discover universal laws that make the future predictable. If we have enough scientific understanding we can, for example, build bridges that we can predict will not collapse. We can construct an entire scientific infrastructure in our society.

The entrepreneurial method aims higher, at human flourishing. It aims at discovering how we can all work together to achieve our human purpose, including new purposes that we all agree are worth achieving. We can construct an entrepreneurial structure to build a better human life and a better society.

Entrepreneurs choose a control strategy that’s appropriate to uncertainty.

Some people fear entrepreneurship because its outcomes are uncertain. But this is worrying about the wrong things: outcomes are outside your control. Entrepreneurs are more discerning about what can be controlled: means.

Dr. Sarasvathy lists several control strategies:

The Bird-In-The-Hand Principle: work with what you’ve got and can control, which she sums up in the questions: Who Am I? What Do I Know? Whom Do I Know? What resources do I own or control now? This is the first principle of control.

Affordable Loss Principle: Entrepreneurs can control their downside, making it affordable and limiting uncertainty, by asking “What one value generation project would I undertake even if I risk losing everything I invest In it?”

Crazy Quilt Principle: How do entrepreneurs control the uncertain process of identifying the right partners, including hiring the right people? They don’t try to predict the results of hiring and pitching. Instead, don’t hire, don’t ask. Just talk to people — those who fit best will self-select into your project.

Lemonade Principle: Don’t fear the unexpected. Welcome surprises. All unexpected happenings are opportunities and can become resources. Leverage contingency, and make lemonade out of lemons.

The Pilot Is The Plane Principle: Everyone on the plane is a pilot, co-engaged in shaping history. The plane will reach a destination, the exact nature of which is unclear, and everyone on the plane contributes to getting there.

There are some guidelines that entrepreneurs have established over time.

Non-Predictive Action Is The Driver

Everything in the entrepreneurial method is driven by action. Or, more completely, action, interaction and reaction. Things you care about, things you can actually do, things we can do together, and how we handle surprises. Interacting with the environment with a sense of purpose, and thereby changing it in some way.

Even-If Thinking

Our aspirations and the outcomes we experience may not be symmetrical. Not succeeding is not the same as failing. Even if a new idea does not work out, what is the worst that can happen? We shouldn’t make decisions just because we can’t predict the future. Embrace the unpredictable but make sure the downside is under your control.


The great productivity of entrepreneurship comes from intersubjectivity — two or more people can interact and come up with something neither one had actually thought about or dealt with or considered or contemplated before. Intersubjectivity is more than interpersonal and beyond negotiation. It’s a question: “I am doing this. What do you think?”

The Entrepreneurial Method leads to social good and a new role for business in society.

A side effect of everyone in society learning the scientific method was the emergence of the middle class, defined by income. Science brought productivity which enabled a large swath of society to earn enough money to escape poverty. Everyone was able to harness science.

Let’s teach everyone the entrepreneurial method. Let everyone start companies, grow companies, invest in companies, all with no thought of prediction. A middle class of business will emerge, defined not by income but by venturing. This middle class will produce more jobs and more enduring, more stable companies, embedded in strong communities, with greater well-being and less churn. The fruits of creativity take root in endurance and durability — not in Schumpeterian creative destruction — and contribute to stability and the taking on of bigger challenges. Decade after decade, the middle class of business will generate value and produce wealth, employing lots of people and educating successive generations to take the entrepreneurial method with them into a better future.

Additional Resources

“The Entrepreneurial Method” (PDF): 

Among the innovations planned for the Economics For Business platform is a series of encapsulations of important research papers. Here is a sample:

“The World-Making Scope Of The Entrepreneurial Method — An Encapsulation” By Gabriele Marasti (Original paper: “The Middle Class Of Business”):

Some links:

Effectual Entrepreneurship (PDF):

“What Makes Entrepreneurs Entrepreneurial?” (PDF)

“Entrepreneurship As Method: Open Questions for an Entrepreneurial Future” (PDF):

130. Eamonn Butler’s Primer on Entrepreneurship and Its Social Good

Entrepreneurship is the great force for social good — in fact, the greatest force for good in the history of civilization. It’s the system of continuously improving the lives of others so we can improve our own lives. Through entrepreneurship, we can achieve greater and greater levels of community, collaboration and societal advance. Eamonn Butler, Co-Founder and Director of the Adam Smith Institute, has written what he calls a Primer for understanding and appreciating the wonderful institution of entrepreneurship. He highlights some of the key points on the Economics For Business podcast.

Innovation and improvement.

To continuously improve people’s lives, we need new things. We need people to invent things that haven’t been thought of before. And we need innovators, people who improve those things and find new purposes for them or new ways of producing and distributing them. And we need entrepreneurship, the marshalling of resources to produce these better things faster and more efficiently and get them into more people’s hands.

Entrepreneurs are those unique people who organize the marshalling of resources, and who risk their own capital and their investors’ capital in this pursuit of a better future for all.

Cascading Development.

When entrepreneurs undertake this act of discovery, and especially when they succeed, they trigger cascading development. One innovation and entrepreneurial initiative leads to another. They are all aimed at making people’s lives better — easier, healthier, more convenient, more affordable, more efficient. And, eventually, knowledge spreads, and people’s lives are transformed, so that Indian peasant farmers can check produce prices on their smartphone and get the best offer from the market. Development cascades from individual to individual, firm to firm, market to market and country to country. It’s never-ending improvement.

Long-termism and ethical behavior.

The outcome is long term uplift and benefit for all. Entrepreneurs are long term thinkers. They are focused on the lifetime of their company and their products, and perhaps to passing them on to the next generation (Politicians are the opposite — they can only think in election cycles).

Entrepreneurs don’t want to just make a short term profit and then leave the market. They want long term revenues and long term profits. That means creating reliable, returning customers who love the entrepreneur’s product. That requires delighting those customers, serving them impeccably, never letting them down or breaking a promise. There are few other, if any, institutions that are constituted in this way.

This Long-termism is ethical. Entrepreneurship is ethically driven.


A small firm can trade on a global stage, and if they can, they will. It’s easier than ever before in the digital era. New and better ideas quickly spread around the world. But it has always been the case, since the earliest of times. Politicians establish borders to divide people, and then violate them in invasions and wars. Entrepreneurs see no borders between people. Political borders can’t divide markets.

Social good.

Entrepreneurship achieves more for social good than any other institution. Entrepreneurial innovation in goods and services enhances life and opens up new possibilities. Customers flock to entrepreneurs because of the tremendous service they deliver. The constant improvement delivered by entrepreneurs constitutes civilizational progress. The competitive pressure to improve quality and utilize resources more efficiently generates more and more value for the world.

It’s an error to see business as extractive — extracting and using up resources. Business is generative, putting life-changing inventions at the disposal of the global population. What’s seen is the dirt and smoke left over from mining or manufacturing. What’s not seen, and is often unappreciated, is the huge amount of good that comes into the world via entrepreneurship.

Entrepreneurship is the application of property rights at every scale.

It’s another error to think of entrepreneurship as small business or young and immature business. Ray Kroc of McDonald’s was a great example of an entrepreneur who worked out how to operate a hamburger restaurant at global scale with continuous improvement. Entrepreneurship requires property rights; people need to have control over their property in order to transform it into marketable innovations and services. But that does not limit the scale of entrepreneurship. Property rights are a principle that supports global scaling.

The entrepreneurial method.

Probably the best way to define entrepreneurship is as a process or a method. It’s akin to — and as important to civilization as — the scientific method, but different. They both involve trial-and-success, coming up with ideas and testing them. The scientist tests against reality, looking for a law, a repeatable outcome that will never vary. The entrepreneur tests against consumer approval, looking for acceptance that might be repeatable until conditions change, such as new competition arriving. Entrepreneurs can’t predict the future as scientists can, and they can’t exert control in the form of unchanging laboratory conditions. Yet they still are challenged to build a business that lasts.

Can we nurture this institution?

Yes. In school, via literacy and entrepreneurially-oriented education, teaching young people about profit, and uncertainty and the requirement for supportive environmental elements such as property rights and flexible labor laws, and the value of trying multiple different initiatives before discovering a winning proposition. We might not be able to teach successful entrepreneurship, but we can create the conditions for learning.

A selection of books by Eamonn Butler

Entrepreneurship: A PrimerView on Amazon

Austrian Economics: A PrimerView on Amazon

Classical Liberalism — A PrimerView on Amazon

Ludwig von Mises — A PrimerView on Amazon

Friedrich Hayek: The Ideas and Influence of the Libertarian EconomistView on Amazon

The Condensed Wealth of NationsView on

105. Per Bylund: Austrian Economics is the Science of Business Success

For any size and any type of business, the generation of value requires more than strategy, planning, and executional excellence.

It calls for the establishment, communication, and internalization of value-generation principles, solidly founded and consistently applied. This concept of the long-term, dynamic application of unchanging principles is the essence of the Austrian approach to business.

Download The Episode ResourceLong Term Value Generation As A Science Of Business Success – Download

Key Takeaways & Actionable Insights

In a podcast conversation, Professor Per Bylund reviewed and critiqued the popular business book The Science Of Success, and focused on these principles or guidelines.

Vision For Long Term Value

Vision in this context is not the transcendental futurism of a CEO-with-superpowers often envisaged in business school texts. This is Austrian vision: a deep understanding of what constitutes value and how to act to realize value over time, rejecting short-term opportunism.

Value, of course, is subjective, determined by consumers, and so businesses that generate long term value can be seen as creating value for society, a laudable ethical contribution to social well-being.

Virtue and Talents

It’s unusual to encounter the word virtue in a discussion of business. In this context, it applies to the selection and hiring of a team that will collaborate on the long term creative task. This requires dynamically melding people with the right values, skills and capabilities, and the capacity to develop skills and capabilities even further. Hiring becomes one of the most important and most value-generating business functions.

Knowledge Processes

Entrepreneurial value creation is a knowledge-based and knowledge-intensive process. Knowledge is actively pursued, curated, combined, and processed. Knowledge advantages may be available, where firms are able to craft uniquely superior processes, methods and technologies. Crucially, these are never permanent. They can always be competed away, and rendered redundant by changing markets and evolving consumer preferences, although some forms of knowledge advantage, such as brands and culture, can be more long-lasting. Knowledge processes must include not only knowledge management but also the creation of new knowledge.

Decision Rights

Business books often talk about organizational design, but less often about the details of the processes of decision making. Whether the organization is hierarchical or flat and networked, it must still be able to make decisions and have them accepted and supported and implemented. Putting people in the right roles with the right degree of authority and accountability is the business challenge. This is different from the mythical business school idea of “leadership”; it’s a more a matter of productive collaboration among multiple individuals and teams, all of whom have some authority. The concept of decision rights breaks the ties and the logjams and enables corporate dynamism.


The idea that behavior is responsive to incentives is core to the science of economics, of course. The same is true in business, and it’s important to use economic reasoning to get incentives right and avoid adverse incentives. The proposition given in the Science Of Success is that people are rewarded according to the value they create. Thus, we come full circle, back to the vision of value that constitutes the first of these 5 principles. If a business is clear on its definition and understanding of value, then it can be successful in incentivizing its people to generate that value.

Additional Resources

Long Term Value Generation As A Science Of Business Success (PDF): Download Here

QJAE Special Double Edition on Entrepreneurship (PDF): Download Here

The Austrian Business Model (video):

Start Your Own Entrepreneurial Journey

Ready to put Austrian Economics knowledge from the podcast to work for your business? Start your own entrepreneurial journey.

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83. Clay Miller: An Entrepreneurial Journey to New Lands, New Organizational Designs and New Value

Key Takeaways & Actionable Insights

The entrepreneurial instinct can be sparked in K-12 and around the family dinner table.

An entrepreneurial culture is highly beneficial to society at the global, national, and local level. We should examine how well we nurture the entrepreneurial instinct in K-12 schooling and in the discussions we have with our kids at home.

Clay Miller got a Commodore 64 (you can look it up!) when he was 11 years old, and his interest in computing, software and writing code started there. He was a programmer at 11 years old (something that is more common today than it was when Clay was young) and developed a taste for programming and an aptitude and some skills. He learned how to jump over hurdles of software-writing complexity at a young age.

A mentor can reinforce a young person’s disposition towards entrepreneurship, and accelerate their progress.

A local tech entrepreneur took Clay under his wing and hired him for programming projects. Clay built accounting software and other products in this arrangement as a high school student. Observing and participating in this entrepreneurial environment at an early stage in life gave Clay the idea of entrepreneurship as a future pursuit. He started to take on consulting assignments while at college, although he wouldn’t yet identify tech entrepreneurship as a “career”. He was able to begin to make the transition from pure programmer to customer service entrepreneur. Starting early can influence a lifelong entrepreneurial journey.

There are many ways to accumulate knowledge, and entrepreneurship is a fast track to applicable knowledge.

Clay chose serving customers as a pathway as opposed to continued learning in school and a conventional corporate career path. Both paths are ways to acquire knowledge. Identifying the process you prefer for knowledge acquisition – school or entrepreneurship – is a valid choice. Entrepreneurship may be the quicker and more direct route. And entrepreneurial knowledge is often more applicable, and more rapidly applicable, for your own individual economic ends.

An entrepreneurial leap forward resulted from identifying and supporting a new emergent industry.

Clay took a job as a CTO in an emerging industry; organ and tissue transplants. This enabled him to experience economic growth at a higher level through the application of technology in a high-demand environment. He learned about fundraising and financing and shaping resource allocation based on the funding available. He learned about mass customization for a diverse customer base. He learned the role of the technical advisor vis-à-vis the CEO, enabling the executive suite to achieve its vision. Finding a growth industry can accelerate your individual development.

Transition from tech expert to global customer service entrepreneur.

Clay was initially a user of offshore outsourced technological services. He mastered the economics and logistics of this organizational arrangement. Quickly, he founded his own Asia-based outsourcing corporation, and added a significant innovation: the embedded outsourced CTO. Often, firms use outsourced technology services for the flexibility of dialing up and dialing down service intensity on demand. There is a downside to this flexibility, which is loss of continuity and accumulated knowledge, as contractors move on to other jobs. Clay performs the role of CTO for his clients, ensuring them continuity of strategy, and keeps his outsourced tech talent available in his own ecosystem, so that accumulated client knowledge is not lost and can be reapplied later in the cycle.


Clay’s journey can be seen as an illustration of what psychologists call the PDA cycle – Perception, Decision, Action. Entrepreneurs perceive the world around them in a subjective manner, conditioned by their individual circumstances. In Clay’s case, those circumstances included exposure to technology, and some experimentation with it, at an early time in his life. Later, he made some decisions on best choices – e.g. between school and entrepreneurship – based on his perceptions. He acted, became a tech entrepreneur and then a customer service innovator. Every action changes the world, and so changes the entrepreneur’s (and the client’s) perceptions, leading to new decisions and new actions. Entrepreneurial success emerges from the process.

See our PDA graphic to further stimulate your thinking.

You might also enjoy reading this paper from our colleagues Nicolai Foss and Peter Klein on the language of opportunity. They say that opportunities do not exist in any objective fashion. They are not “out there” to be “seized”. Entrepreneurs create their own outcomes. Foss and Klein call their process B-A-R: Belief, Action, Results. See if you think B-A-R is different from P-D-A.

Free Downloads & Extras From The Episode

The Entrepreneur’s PDA Cycle: Download PDF

Foss & Klein’s Entrepreneurial Opportunities, Who Needs Them?: Download The Paper

“The Austrian Business Model” (video):

Start Your Own Entrepreneurial Journey

Ready to put Austrian Economics knowledge from the podcast to work for your business? Start your own entrepreneurial journey.

Enjoying The Podcast? Review, Subscribe & Listen On Your Favorite Platform:

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Meaning In Life Is Critically Important To Well-Being. Entrepreneurship Is A Key Route To Get There.

Podcast Transcript: Clay Routledge (Professor of Psychology, North Dakota State University and Director, Existential Science Laboratory) and John Bitzan (Director of the Sheila and Robert Challey Institute For Global Innovation And Growth at North Dakota State University) discussing entrepreneurship and meaning in life on the Economics For Entrepreneurs podcast,  August 25, 2020.

Listen to the full episode here.

Hunter Hastings:

Clay and John, welcome to Economics for Entrepreneurs.

John Bitzan:

Thanks for having us.

Clay Routledge:

Yeah, thanks.

Hunter Hastings:

Well, thank you both. You’ve given us a very uplifting subject today, which is the subject of meaning in life as it relates to capitalism and entrepreneurship. It’s something that you’ve studied and researched, and you’ve developed considerable expertise in it. So we’re looking forward to hearing from you. We always like to start with origin stories, John and Clay. So this is a podcast about entrepreneurial economics, but you’re not both economists, I don’t think. Clay, you’re a psychologist, I think.

Clay Routledge:

Yeah, that’s correct.

Hunter Hastings:

But you do focus some research on the study of entrepreneurship and innovation. So tell us your background and how you got to develop that particular focus.

Clay Routledge:

Yeah, that’s correct. My training is in psychology and specifically social psychology. So my background really is focused on human motivation, so what is it that inspires human to do the things that we do, what energizes our goals and our aspirations. And within that area, my specific area of expertise is in what’s called existential psychology, which is a pretty broad area, but it focuses on all sorts of questions that humans are uniquely positioned to ask, such as questions about the meaning of our life, why we’re here, what purpose we serve, what happens to us after we’re gone. So these kind of heavy philosophical questions. And what my research focuses on within that area is how those questions and related pursuits drive human behavior. And so you can kind of start to see hints as to why this might be important for economic variables and issues such as entrepreneurship because based on my work, there seems to be good reason to think that one of the major motives for our species is to live lives of meaning. We want to feel like we’re significant contributors to a meaningful world. And within that, we endeavor to do all sorts of things to make our mark, to have an impact on our families and our communities and a broader society.

And I see entrepreneurship as one specific domain within that. So that’s kind of the broad area of research that I’ve been doing for, not on entrepreneurship specifically, but just on meaning in life as a powerful human motive. I’ve been doing that work for over 15 years now. And my formal title is now Professor of Management at North Dakota State University in the Department of Management and Marketing. And I work with John, who will introduce himself shortly, at the Challey Institute.

Hunter Hastings:

Let’s have John introduce himself now. I read in your background, John, that you’re a business economist and a Professor of Management. And we know enough from our own E4E background with our professors that that can mean a lot of different things! So tell us about your work and how you connected with Clay on this intersection of psychology and economics.

John Bitzan:

I’m trained as an economist, not really a business economist, but an economist. And most of my research actually has been in the area of transportation economics. And if you’re familiar with the history of transportation in the United States, you know that the transportation industries were some of the most heavily regulated industries in the US until the 70s and early 80s. And so studying the problems in the industry and the huge improvements that have occurred with regulatory reform gave me a really good appreciation for the harm that can be caused by over-regulation. I also have taught courses in the College of Business in international business and international economics, and I think that it’s impossible to study global markets without noticing the huge role that economic freedom has played in elevating people out of poverty and making people’s lives better. And so a year ago, I got the chance to lead in an institute, the Challey Institute, that’s focused on looking for ways to unleash the power of the private sector to create economic opportunity. And so I jumped at the opportunity.

And since the institute was new – it included me and one administrative assistant – we needed to find a way to attract existing talent at NDSU to the Institute to start helping us do some of the research that we were interested in. And so we gave a small stipend to faculty that wanted to participate in our institute, and Clay was one of those faculty. And quickly, it became obvious to me that the stuff that Clay was working on was super interesting and very important as well and fit very well with the mission of the Challey Institute. And so Clay has been gracious enough to let me be involved in working on this new research with him. And so I’m along for the ride. He’s allowed me to come on for the ride, and I’m really excited about it.

Hunter Hastings:

We’re excited too to learn about this intersection of psychology and economics. We certainly believe in economics as action, and as entrepreneurial action specifically. On the producer side, we try to understand motivation because that’s a big part of what’s driving that action. So we’ve got a lot to learn from you. Let’s start at the beginning. And maybe, Clay, you want to start. I read the paper with the title Why Meaning Matters for Freedom and Flourishing. Please define meaning and how important it is for mental and physical wellbeing.

Clay Routledge:

Generally in the scholarly literature, meaning is defined as people’s perception of the coherence, significance, and purpose of their lives. What that means is at some basic level, all organisms are sense making. We need to make sense of our environment in order to navigate it. So we look for a world that has patterns and is predictable. Humans are distinct from other organisms in our higher level cognition. So in other words, we’re smart. We have the ability to reflect inwards, to reflect on the self in this higher level consciousness, which allows us to do all sorts of things that other creatures like my dog can’t do. And this includes have long-term goals and aspirations and to think about ourselves in the future. And so when we try to make sense of the world, we’re not just trying to make sense of our environment around us in order to survive and thrive. We’re trying to make sense of our own lives. We’re trying to find our place in the world where we function. And so as a result, our meaning making is very much focused on our desire to be significant, to play a role in society and to have a purposeful existence. That’s kind of generally what we mean by meaning in life.

And people seem to understand this. In research, looking at lay perceptions of meaning, you can just ask people generally, “To what extent do you view your life as meaningful?” And there’s quite a bit of consensus on what that means and what predicts that and how responses to that predict other outcomes. So people generally seem to have a good subjective sense of what it means to have a meaningful and purposeful life.

Hunter Hastings:

As part of meaning, Clay, in your paper, or John, you might to answer this, you talk about social bonds and work as vital for a sense of meaning. Can you expand on that point? Because clearly, entrepreneurship is a social activity, and we’re going to try and make that connection. So why are social bonds and work important for meaning?

John Bitzan:

Okay. I’ll start, and then Clay can add the stuff that I’m missing. I would say this. People want their lives to matter, and so people have a greater sense of meaning if they play an important role in the lives of others and society. You want to have a purpose outside of yourself, and that involves social bonds. So why am I motivated to go to work every day and give my best effort? Well, I know that I’m contributing to my family by doing that, and I know that I’m making a difference in the world by doing that. And when we talk about work, it could be paid work like I’m doing, or it could be somebody volunteering. It could be taking care of kids. I would say all those things facilitate meaning because they’re making a contribution to someone else beyond just making a contribution to your own welfare. It’s contribution to society, to family, to others.

Hunter Hastings:

In systems theory, we talk a lot about fitting in and contributing, so understanding how you fit in with others, that’s part of behavior, and then contributing to the system in a way that, as you say, can make a difference.

Clay Routledge:

Yes, I think that’s absolutely right. I mean, if you think about humans as a social species, we can’t survive very long on our own. That’s why historically you look at punishments like banishment as being almost a fate worse than death because people know they need each other to survive and thrive. So I think meaning is one way that you know that you’re in the game, that you’re doing something, that you’re making a valuable contribution to those around you.

Hunter Hastings:

You mentioned motivation, Clay. You make a specific point that meaning itself is motivational. And you also mentioned existential agency, and that’s the link to economics. There’s a sequence that connects the motivational power of meaning to economics. Tell us a little bit more about motivation as you see it, and then explain existential agency a little more because that’s a little bit of a difficult term to grasp.

Clay Routledge:

Historically, the research on meaning in life has really treated meaning as just another indicator of wellbeing. For example, people who see their lives as meaningful tend to live longer and healthier lives. The question is why? What does meaning have to do with being healthier? If you dig a little deeper, what you find out is that it seems to be the case that people who see their lives as meaningful are just more motivated to live healthy lives. The reason they live longer is because they make the types of choices that reduce the risk of mortality. They eat healthier. They exercise more. They avoid harmful things, so they’re less likely to abuse drugs and alcohol. In other words, it seems to be the case that when people feel like they have a purpose in life, that they matter, they want to take better care of themselves. That paves the way for thinking about meaning as a motivational force. If meaning generally motivates people, then it starts to make sense that you could think about how it might connect to economic issues.

That, in turn, leads to the existential agency component. Based on all this experimental research, including some work I’ve done, but others as well,  we are finding that when people are focused on what gives their life meaning, when they focus their attention or their awareness on what gives their life meaning, they’re just generally motivated. We wanted to capture that idea as a specific dimension of meaning. That’s where this kind of sequence comes into play: when people feel like their life is meaningful, they feel more agentic. What that means to us, or how we define existential agency, is the extent to which people believe that they have the ability, that it’s in their power, to pursue and maintain meaning in their life. So it’s that kind of agentic or motivational or self-regulatory dimension of meaning.

Hunter Hastings:

I can certainly see how that would connect, then, to entrepreneurship as a behavior. Let’s advance to the study that you recently conducted at Challey. I read from the summary of the study, which we’ll link to on the podcast page, that you were investigating the possibility, which you just described, that people’s beliefs about meaning and their existential agency may influence a range of economic beliefs. Tell us how you thought about the study, how you designed it, how you executed it, and then we’ll talk about the results.

John Bitzan:

Yes, we wanted to see whether existential agency and people’s own perceptions of meaning influence their views towards capitalism and entrepreneurship? Do they influence people’s views towards whether they think that capitalism and entrepreneurship can solve important problems? And do they influence people’s own entrepreneurial aspirations? We surveyed over 1,200 Americans, and we asked them a variety of questions, questions about their perceptions of meaning, and their existential agency. We asked them about their religious faith, perceptions of their social bonds and support, their income, their political affiliation, and a number of other demographic variables. We also asked them their general views toward economic freedom and, again, whether they think that capitalism and entrepreneurship can solve important problems like climate change, poverty, and automation. And then we also asked them about whether they wanted to become an entrepreneur themselves and how motivated they were to become an entrepreneur. We found that even after you control for age and income, political affiliation, and other demographic variables, that people that have more existential agency – i.e. a belief that you can maintain and obtain meaning in your life – were more like to have positive views towards capitalism and economic freedom, and they were also more likely to think that capitalism and entrepreneurship could solve important societal problems. And also they’re more likely to be motivated in their own entrepreneurial aspirations.

Hunter Hastings:

So we might say this kind of a macro component to that, and a micro component. Macro in the sense that I believe in entrepreneurship as an institution and capitalism as an institution. And then micro, in the sense that I think I might be an entrepreneur myself. Is it accurate to say it applies at both those levels?

John Bitzan:

Yes, that’s very accurate. Again, I would say that people who have existential agency, that means that they believe that they can maintain or obtain meaning in their lives, are more motivated to take actions that are likely to help them achieve that meaning in their lives. And one of those actions might be becoming an entrepreneur, which means that you can obtain meaning by serving your family by becoming an entrepreneur. You can solve important problems to help other people. You can employ people in your local community. At the micro level as you’re talking about, it motivates me to want to pursue my entrepreneurial aspirations. And, if I think that I can benefit and I can achieve meaning by taking certain actions, I’m going to support the systems that allow me to take those actions as well. And so those systems would be a free market economy or capitalism as an economic system.

Hunter Hastings:

Belief in meaning in life is important for sustaining economic freedom, which is another way to say the institution of free market practices.

John Bitzan:

Yes, that’s right.

Hunter Hastings:

One technical point here. I noticed that you established a score for existential agency. We are big believers here in qualitative research and that you might be able to rank things ordinally, but you might not be able to actually score them cardinally. How did you arrive at a score for existential agency? How do you think about it in your data?

Clay Routledge:

We have a questionnaire, which is an eight-item questionnaire of measures of existential agency. Subjects respond as you would in a typical survey, indicating  to what extent they agree with a series of statements that include things like, “I have the ability to pursue a meaningful life” or “I have the power to make my life meaningful” or “I’m responsible for discovering my life’s purpose”  or “When life feels meaningless, I’m capable of restoring a sense of meaning in life.” It’s those types of items. They indicate how much they agree with those statements. So the higher the score, the higher they are on existential agency.

Hunter Hastings:

So they’re scoring on a belief scale?

Clay Routledge:


Hunter Hastings:

Got it. Another term that you mentioned in the paper, and I think we’ve used it as well, but I personally have a lot of trouble with it. John, you may have covered it in what you said earlier, but you said that meaning in life is associated with pro-social behavior. And presumably, the opposite is true. And we come across that term, pro-social, in a value system that we use as an analytical tool, the Rokeach Value System. Rokeach talks about pro social behavior. But what’s the definition of that? What exactly does it mean?

Clay Routledge:

I’m not sure there’s one single definition, but I can speak to how psychologists think of it, which is that pro-social motivation is generally considered motivation that isn’t just solely focused on your own wellbeing or your own life outcomes. So for instance, to focus on entrepreneurship, you could start a business, and if you say, “The only reason I’m starting this business is because I just want to make as much money as possible, and I don’t really care if this business is good for society or bad for society.” That would not be considered pro social from a social psychology point of view. But if you were to say something like, “Hey, I want to start this business, and of course I want to make money. I have to support myself. But also part of my motivation to start this business is to serve my community. There’s a need that I’ve identified in my community, and I think I can meet it…” Of course pro-social things can include other things that have nothing to do with business, like volunteering, philanthropy, and other activities. But generally, the idea is that you’re doing something that you think extends beyond your own individual self-interest to others.

Hunter Hastings:

That’s really helpful for us because we think about entrepreneurship as having a social component. It supports society. We think of that at the institutional level. We talk about entrepreneurship solving mal-adjustments in social arrangements and elevating society generally. But you’re also saying that that’s an individual or micro motivation for entrepreneurship, is to serve the society that you can see and be part of in your community, your village, your town, your social group, whatever it is. So again, it’s both macro and micro. Is that correct?

Clay Routledge:


John Bitzan:

I agree with that too. One thing I’d like to add, too, is that you think about successful entrepreneurs are motivated to solve problems. I mean, what gives entrepreneurs the idea to start a business? They recognize the problem, and they solve that problem that helps other people. And so I would say by its very nature, entrepreneurship entails pro-social behavior because you have to empathize with others. You have to find a way to help someone else in order to develop and sell a product that’s going to make you successful as an entrepreneur. So you have to think about other people when you’re pursuing entrepreneurial activities.

Hunter Hastings:

One of the terms we always use is the ethic of entrepreneurship, and we define that ethic as a service ethic. I’m trying to help other people, as you said. I’m trying to make their lives better. I will profit from that after the event, but the ethic is service. Did you find anything about service? Or is that simply another complimentary way of saying the same thing, pro-social behavior?

John Bitzan:

We don’t specifically measure that, but I believe that that’s accurate, exactly what you’re saying. I think it’s very similar to the point that we’re making.

Clay Routledge:

Yes, I agree.

Hunter Hastings:

A further development of that idea is that social justice and entrepreneurship are entirely consistent. Effective entrepreneurship can’t be unjust, and what’s unjust can’t be entrepreneurial because of this ethic of service. Did any of your findings relate to that ethical or moral aspect when people say they believe in entrepreneurship and in free market capitalism? Did it touch on ethics and morals or not?

Clay Routledge:

That wasn’t a focus of our research, but as John mentioned earlier, we did ask people to what extent they think capitalism, and also more specifically to what extent they think entrepreneurship, can help solve major challenges in our society including things, as John mentioned, like climate change and poverty. We did get at it that way and found that the more existential agency people have, the more likely it is that they think that capitalism and entrepreneurship could help solve these societal ills.

Hunter Hastings:

In your summary paper of the two studies, you talk about current threats to meaning, freedom, and flourishing. One of the things you mention is that our current technology-driven affluent world creates some existential vulnerabilities. The foundations of our existential health are under stress. Please tell us more about that, what you’re seeing.

Clay Routledge:

I think that one issue – that of course other people have identified as well – is oftentimes when a society has a lot and is very comfortable, then people sometimes feel like they lack the ability to have a role in it or they don’t have the challenge or some way to directly see their contributions. Of course, I don’t think that’s inherently true. I think bigger problems actually are the way we sometimes educate young people and promote this idea that they don’t necessarily have a lot of control over their lives or they don’t necessarily have the ability to overcome the obstacles that they face, that all their problems are systemic instead of thinking about ways that they could take some control over their lives and make meaningful contributions. So I think a lot of these issues are cultural in nature, if that makes sense. They relate to a cultural world view that perhaps undermines existential agency.

Hunter Hastings:

That’s pretty alarming if it’s the case. Do you see a world that is declining in terms of its ability to empower citizens with existential agency? I mean, that might not be the right way to phrase it, but are we going downhill in existential agency?

Clay Routledge:

We don’t have longitudinal data on that. So we’re not in a position to be able to say that, compared to five years ago or 10 years ago or 20 years ago, existential agency is lower. My personal concern… and maybe John has other thoughts on this… is that in our culture, we often see a decline in faith in institutions. And it has been quantified, that among young adults, the percentage of people who think it’s essential to live in a democracy is declining. Support for socialism is increasing, and support for capitalism appears to be decreasing. Religious faith is in decline, and that’s not to say that that’s the only way that people can find meaning, but one thing we do know is that religiosity is correlated positively with meaning in life. And a lot of the world’s religions definitely emphasize the idea that people have ways that they can be part of something bigger than themselves and that they can matter and make a difference in the world. And so it seems like religious faith inspires people to feel meaningful and to be agentic. So to the extent that those kind of indirect markers of existential agency or what we might think of as correlates or predictors of existential agency, to the extent that those are under threat or uncertain, I think there are reasons to be concerned. But that might be just me.

Hunter Hastings:

John, do you have anything to build on that or add to that? Or are you more optimistic? What’s your point of view?

John Bitzan:

No, I actually agree. Clay and I have talked about this a lot, and I see the same concerns. I think either Pew research or Gallup were showing polls of young people valuing socialism more than capitalism or thinking that socialism was a better system than capitalism as a system. And that is something that kind of puzzled me. What is that the case? And so that’s actually one of the things that we talked about very early on in this research.

Hunter Hastings:

It might be interesting to run a longitudinal study like Pew and Gallup do, but on existential agency. That would be an interesting trend line.

John Bitzan:

Yes, I think so.

Hunter Hastings:

Your research also, or your publishing of it is very contemporary. And you said that, for example, a focus on meaning is especially important as we recover economically from the pandemic crisis. Why do you think it’s particularly important now? What caused you to make that remark?

John Bitzan:

Just because if you look at now, everything was essentially shut down by mandate from the government, and so the only way to have a true economic recovery is for sure going to rely on the private sector. Government can pass relief packages, and they can ease some short-term pain that businesses and individuals feel, but they can never replace the production and the innovation and entrepreneurship that drive our economy. And so I think that it’s really important to pay attention to making sure that the economic system that supports, that drives our economy, which is capitalism and entrepreneurship and making sure that people have entrepreneurial aspirations themselves, it’s really important that we focus on meaning. And if you look at even currently, there’s been a lot of contributions that have been made by businesses that have helped sustain our economy. So I think about healthcare companies developing faster tests for COVID, experimental treatments, working on vaccines. Distilleries have switched some of their production from producing alcohol to producing hand sanitizers. Some clothing companies have switched their production to making protective face masks. Restaurants have come up with innovative products like happy hour in a box, which is a pretty interesting idea as well.

And so I think that it’s really important… And Clay and I have talked about this as well, that we think it’s really important that a focus on meaning right now is especially important. So to the extent that there’s any policies that are put in place that either send direct or indirect messages to people that they’re unable to contribute to society or that they need to rely on the state to improve their situation, that’s likely to be especially damaging to meaning and existential agency and then resulting in less favorable views of economic freedom and entrepreneurship. We think that it’s really important. For example, policies that make it hard for companies to hire workers or give incentives for people not to work, like the supplements to unemployment insurance that pay people more to stay at home than to actually go to work, policies like that can be especially damaging, I think.

Hunter Hastings:

Absolutely. And you also made the point that the connection between meaning and entrepreneurship is particularly important for racial minorities. And you specified the black community. Can you comment on that please?

Clay Routledge:

I think in the… And John might know the numbers actually, but a number of reports have indicated that black-owned business have been particularly hard hit by the pandemic-related shutdowns. And so even just thinking about that as a vulnerability issue, it seems like black entrepreneurs in particular might be in a situation which they’re facing a lot of stresses and difficulties with their business. And one thing that we found in our own data was that the same relationship between existential agency and entrepreneurial motivation was present across different racial groups. So it wasn’t the case that it was just for one group or the other. This model seems to be the same across groups. And so we think that might be of importance as people face these particular challenges during the pandemic.

Hunter Hastings:

Certainly, more existential agency or more sense of it among those minority communities, you would think would be very helpful for them to make progress. Let me make one final point here about the statistics. I’m going to try some statistic speak here. I’m not really qualified for it, but you make a point that your study is correlative, so the connection between meaning and the belief in entrepreneurship and economic freedom could be bi-directional. It works both ways. My thought when I read that was: should we be encouraging young people to find meaning in life so that then they’ll pursue entrepreneurship; or should we encourage them to act entrepreneurially and therefore they’ll discover meaning? Which way around is it? How should we be educating and informing and helping young people in these things”?

John Bitzan:

I think one way to think about it… And I mean, it’s true that the relationship could be bi-directional, but I also think that they previous research that’s been done in psychology, and by Clay in particular, shows that there’s an important role played by meaning and existential agency in motivational behavior. So Clay’s talked about that already. This is consistent with the idea that existential agency and meaning are what leads people to have aspirations to become entrepreneurs, to value economic freedom.But then again, you could also see it being a self-reinforcing mechanism, that existential agency leads to valuing economic freedom, which in turns leads to more existential agency. But the short answer to your question is that I think that it’s important actually to give young people messages that they have the ability to contribute to something beyond themselves, that they can make a difference, and that they have an important role to play in society.

I think it goes along with what Clay was talking about previously, that oftentimes young people aren’t given that message, and again, to the extent that they are given the message to realize that they can make a difference beyond themselves, this is going to help them realize that they have the ability to maintain and obtain meaning in their life, and it’s going to make it more likely that they’re going to support economic freedom and aspire to be entrepreneurs themselves. Whereas if you try to encourage people to act entrepreneurial, it’s going to be difficult to convince them to do that if they don’t think that they can get meaning in their life. So why act entrepreneurially if it’s not going to make any difference at all? Therefore, I think the best thing, from my perspective, is to give the messages to young people that in fact they can play an important role in society and make a difference and a contribution to society.

Hunter Hastings:

Good, good.

Clay Routledge:

Yeah, I agree with that.

Hunter Hastings:

That’s very clear. Your work is very important and uplifting. It’s certainly added to our set of knowledge about the importance of entrepreneurship, this idea of existential agency. I tend to look with my entrepreneurship eye open, but the psychology eye closed. So I’ve learned to look in both directions now. Where do you think it might go next? Is this a series of studies? Do you have some more research in mind? What do you see in the future?

Clay Routledge:

This was kind of our first look at exploring these issues because honestly, there really hasn’t been much work linking these kind of existential questions to more economic issues. There is a little bit of encouraging data. For instance, there’s some work showing that the more people see their lives as full of purpose, that actually predicts future income and net worth. So there’s a little bit of correlational data out there, but really no one’s really dug into this connection, this motivational connection, and specifically one related to existential motive. So I think there’s a lot of different directions that we can go in. I think John and I are both motivated ourselves to do so.

John Bitzan:

Just to add to that, I mean, the stuff that Clay… And Clay is by far the leader in this….the stuff that he does in this area as an economist is super interesting to me. I mean, just to think about what motivates people, I mean, as an economist, that’s what excites me about economics, is to try to explain human behavior. And this is a really great way to think about what Clay has been working on.

Hunter Hastings:

And I think it’s much more productive than what they call behavioral economics, which is supposed to be chiding us because we’re not rational and we have the wrong biases and stuff like that. This is a kind of multi-disciplinary approach where by combining disciplines, you learn new things. You get new insights. And you point to better things in the future.

Thank you for the research. Thank you both for appearing today. And thank you for the Challey Institute. That’s a very exciting discovery. I didn’t know about it before. And thank you for NDSU. It’s not one of the universities that we’re often reminded about. You’re certainly doing some wonderful and great things up there. So thank you both.

John Bitzan:

Thank you. We hope we get a chance to talk to you again. Thank you.

Hunter Hastings:

Yeah, let’s stay in touch.

John Bitzan:

Sounds good. Thanks.