Optimists in paid employment earn more than pessimists, new research finds.
Around 80% of people are optimistic, which tends to encourage persistence, cooperation and ambition.
However, being an optimist may not be as good for those starting their own business.
For entrepreneurs, pessimism is a more beneficial personality trait, the research also finds.
Pessimistic business owners earn 30% more than optimists.
Entrepreneurs typically earn less, work longer hours and take on more risk than those in paid employment.
Optimists, though, are more likely to face these issues without realising the dangers.
Dr Chris Dawson, the study’s first author, said:
“Our results suggest that too many people are starting business ventures, at least as far as personal returns are concerned.
As a society we celebrate optimism and entrepreneurial thinking but when the two combine it pays to take a reality check.
Every episode of the BBC’s Dragon’s Den provides examples of such wishful thinking.
Pessimism may not generally be seen as a desirable trait but it does protect people from taking on poor entrepreneurial projects.”
The conclusions come from data covering 18 years taken from a major longitudinal survey.
Professor David de Meza, study co-author, said:
“Governments frequently talk about the role of entrepreneurs in creating economic growth, but there is a downside.
The personal and societal fall-out of failed businesses shouldn’t be underestimated, which is exactly what optimists do.
Policy makers should not encourage the wrong sort of start-up.”
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The study was published in the journal European Economic Review (Dawson et al., 2018).