Here is a statement from the research paper I covered in this week’s microbusiness news:

” … even in a society whose record of invention of valuable new products is exemplary, in the absence of innovative entrepreneurs who have the preparation and knowledge required to ensure that these inventions are put to effective use, economic growth is likely to lag and poverty can be expected to persist.”

And I expect you’re probably wondering why such an innocuous and irrelevant assertion should have caught my eye.

To put it simply, it is a statement that is no longer accurate.

Whatever may have been the case historically — say, for the first 200 years of U.S. history — strong economic growth does not preclude the persistence of poverty. It doesn’t even necessarily slow it down.

In fact, at various times during the first few years of this century, strong economic growth coexisted comfortably with rising poverty.

You know the theory, right? Innovation, besides being the source of all sorts of new gizmos that are supposed to improve standards of living, is a proven source of job creation when crafty entrepreneurs come along and put those innovations to commercial use. In some cases, they’ve been known to create whole new industries.

Unfortunately, some contend, there hasn’t been as much of that as there ought to be lately. Umair Haque says that, during that time period when banks (institutions that are not supposed to be dice rollers) were indulging in excessive risk, venture capital firms (institutions that are supposed to be dice rollers) were investing in the latest fad rather than in real innovations.

Then, too, there is the recent trend we’ve seen in which a rising tide does not lift all boats. Workers, competing for jobs in a global labor market in which American labor is perceived as overpriced, no longer reap the rewards of productivity increases. The higher profits are instead distributed to shareholders.

In short, growth no longer automatically leads to prosperity.

What does lead to prosperity is self-employment. Research has shown that households containing small business owners have higher net worth than households that don’t.

Another economic assumption bites the dust.