I like those questions. "Normal" just means norm, so yes, it's the norm to be relatively-to-significantly emotionally unhealthy. That doesn't mean that it's impossible to achieve a world where 80-90% of the world has secure, high self-esteem, and treats the remaining 10% of people with kindness and patience.

> Is it possible that encouraging typical people to have "higher self esteem" will result in increased narcissism, entitlement or overconfidence?

Absolutely; that's what the "self-esteem movement" in U.S. schools last century did, which is now widely denounced as harmful, and it's a perfect example of bad cultural change that wasn't deeply informed by psychology but instead on emulating behaviors. Low self-esteem is in the unconscious mind. You can try to think and behave like a confident person, but it's all a facade, a new set of learned coping mechanisms, unless you develop deeper self-awareness of your psyche and "do the inner work."

"Good" cultural change means promoting true psychological awareness and inside-out change. Here's a more detailed example if you want:

Pleasant emotions occur when our emotional needs are satisfied. Unpleasant (not "negative") emotions point to unmet emotional or physical needs (that include shame, i.e. low self-esteem). All emotions are useful since they tell you what your emotional needs are and how well they're satisfied. If you're mostly unhappy, you either have low self-awareness (of your thoughts, emotions, and needs at any given time), i.e. you have difficulty consciously identifying what your needs are; or, you can identify them but lack the (learnable) problem-solving skills to satisfy these needs. There are superficial emotional needs, and you can learn to "dig down" to the primary emotional needs that cause them. Sometimes, part of your unconscious can still feel deep unworthiness despite objectively impressive real-world achievements; that can be fixed by integrating that part of your subconscious that is stuck in the past, and bringing it back in line with the rest of your unconscious through inner work. Children have developmental emotional needs, which most of them, most of their teachers, and most of their parents are unaware of, and teaching these needs to all of them would help them do better. Groups (families, classrooms, companies) range from high-nurturance (helps people satisfy their emotional needs) to toxic (prevents people from satisfying their needs); high-nurturing groups (e.g. classrooms) have many traits in common. Group toxicity is generally caused by group leaders being emotionally unhealthy, i.e. having a poor ability to satisfy their own emotional needs effectively.

If the culture was promoting these ideas, I don't think that would be a cure worse than the disease. Going back to the article: building confident children means improving families' nurturance levels, teaching kids how to recognize their own needs and their child's developmental needs, and how to meet them; building children that do that inner work, and who then won't be afraid of "looking dumb" in the first place; and will be secure enough that they won't feel shame if someone dislikes them, and can try to achieve mutual respect with whoever dislikes them without losing their integrity or boundaries. Sounds far deeper and more meaningful than what the article proposes, no?

Here's a resource that might interest you: http://sfhelp.org/site/premises.htm and http://sfhelp.org/cx/skills/dig.htm (the whole site looks very old; but it was recommended to me by someone on /r/Buddhism years ago and is filled with gems).