I went and read that paper. I don't think it says that at all. Their exact conclusion is:
"An individual with a coefficient of relative risk aversion of 2 and assets of $0.7 million would choose employment at a market salary over becoming an entrepreneur. With lower risk aversion or higher initial assets, the entrepreneurial opportunity is worth more than alternative employment"
I didn't understand relative risk aversion, so I looked it up. Here is an example:
"[if you have constant relative risk aversion utility and] If you would give up 2% of your wealth to avoid a 50-50 risk of losing or gaining 10%, then you have a coefficient of relative risk aversion of 4." If you would give up only 0.5% of your wealth to avoid the same gamble, you have a coefficient of 1.
source: http://www.rasmusen.org/x/archives/cat_economics.html
Maybe I'm just not risk averse, but I would not be willing to give up much at all to prevent such a gamble. I'm WAY below a coefficient of 2, and I suspect that many people here on LW are as well.
This is why I said "average" venture-backed founder. You may have tons of assets such that losing/gaining 10% is not a big deal, or you may be naturally less risk-averse than the average person.
Some level of risk-aversion is rational, and it's not obvious to me if people are naturally over or below that level. it's also not obvious to me at all that people on LW would have unnaturally low risk-aversion.
N.B.: This discussion isn't up for mainstream article status, as far as I'm concerned (unless someone else wants to take it and run with it). I just didn't know how else to direct an important question to the LW community in general.
I'm currently a first-year university student in Vancouver, Canada, attending UBC. I have a trust fund and otherwise I will not need to worry about paying for my undergraduate degree. I am open to the idea of going to grad school. So, I have the luxury to take my time in my studies and there are lots of options I can choose from. Majors I'm considering are Cognitive Systems, Economics (and philosophy or math or stats), English, Philosophy and History of Science, Mathematical Sciences/CompSci, or Psychology. I'm open to other options. So, have at it with your suggestions.
Specific Questions:
Should I care more about making money or doing something that I have a "passion" for?
How will this allow me to maximize my production of utilons?
What else should I keep in mind?