Does IQ cause income or vice versa

[tkingdoll]

These folks may have advantages going for them you and I are not aware of ... for a partial list, see post 51. To us, it may appear as luck, but as others have mentioned, it could be a strong ability to take advantages (exploit) of situations. Or past experiences and/or acquaintances. But whatever it is, it's not the common use of the word luck. Why? Because I feel they would fare no better than I side by side playing slot machines, or at a Roulette table, or winning the lottery with equal numbers of tickets. In this regard, they have no more "luck" than anyone else.

And as for being the "lucky bastard" in getting the girl I was after --- well that's again just dumb luck.

I don't disagree. As I've said, there are multiple definitions for 'luck'. But for the purposes of this thread, only one is useful. It's also an extremely common definition, hence the ten-year study of it.

After all, who really knows what goes on inside girls' heads?

I know exactly what goes on in one girl's head, but I can't speak for the rest

 

[jimtron]

Unless I missed it, we haven't yet addressed the titular "vice versa."

Does income cause IQ? I say yes. I mean no. What's the question?

 

[kjkent1]

You've never called someone who repeatedly seems to be in the right place at the right time, or who always seem to land on their feet, or who always seems to have good stuff happen to them 'lucky'? You've never heard anyone use the word that way?

That is the definition I'm talking about. That's the only definition in any way related to careers.

Pardon, but you don't get to dictate the only definition of luck applicable to this thread.

Luck, by my definition, which I believe is quite relevant to this discussion, is a resulting outcome arising from a risk which is at least one standard deviation greater than the expected value.

Buying a lottery ticket has an extremely negative expected value. Winning the lottery is well beyond two standard deviations from expected value.

Bill Gates, as a kid, with zero credentials or experience, managing to sell an entirely novel software programming language interpreter embedded on a semiconductor, to the world's largest computer company, at a time when the idea of a personal computer was still mostly science fiction at IBM, was probably a more unlikely event than winning the lottery.

He didn't just have the right genes -- he had a father who happened to have the right job as a legal advocate for the right company.

The odds against all of these things coalescing at that one moment in history makes winning the lottery look like a coin toss.

Most great discoveries are the result of luck after years of trying. Most celebrities are who they are because they were lucky enough to be in the right place at the right time.

The average accountant, doctor, lawyer or academic professor has not led a particularly lucky existence. He/she is talented and follows a predetermined path to reasonable success via that pass.

And for that person, IQ and income are synonymous. But, for the rest of the world -- the guy that opens the coffee house or the pizza joint or the jewelry store, and who happens to end up with a chain spread out across the world -- that guy is successful because he is lucky that when he first opened his coffee house -- the mall manager didn't lease to Starbucks a month later.

In a world where everyone is competing -- the result of that competition makes everyone pretty average. What separates us is mostly luck -- and if you don't recognize that reality, then my friend, you've either been incredibly lucky, or you haven't risked much during your lifetime.

If you had, you would understand what I'm writing about.

 

[Jekyll]

Pardon, but you don't get to dictate the only definition of luck applicable to this thread.

Luck, by my definition, which I believe is quite relevant to this discussion, is a resulting outcome arising from a risk which is at least one standard deviation greater than the expected value.

Your definition actually fits quite well with Teek's. If you keep try, keep finding opportunities, and trying to exploit them you are bound to, eventually, get lucky once.

Either that, or you're one unlucky, lucky bastard.

 

[zooterkin]

General intelligence factor^WP.

Thanks, I've learnt something (I've fixed the wiki link so it works).

From 1945.

I have the same data from today in the wonderlic manual, but it wasn't electronic and so I couldn't paste it here.

If you're interested in IQs for more current jobs list them and I can post them.

No, that's OK, I was just curious since the jobs listed didn't seem to fit with the date you mentioned.

 

[H3LL]

When someone develops a method to measure "cunning" and "arselicking" I suspect we might have a more accurate correlation.

For example:

George W Bush
CQ (Cunning Quotient) = 200
AQ (Arselicking Quotient) = 180


Me
CQ (Cunning Quotient) = 37
AQ (Arselicking Quotient) = 4

Guess who is richer and more successful?


.

 

[Just thinking]

... If you keep try, keep finding opportunities, and trying to exploit them you are bound to, eventually, get lucky once.

Hmmm .... let's look at that prediction.

If I keep trying at opportunities, eventually, I should get lucky and hit on something successful. Sorry, but that's not luck --- it's more of what would be expected.

Take for example buying lottery tickets. If I were to buy just one ticket in say 10 years and hit the big jackpot, that would be luck. But if I were to be very industrious (by studying the odds) and played enough tickets over many years and eventually hit on one, that wouldn't be lucky --- it would be more like rolling 8 dice over a long time and waiting to see how long it takes for 8 sixes to turn up. Eventually it will happen.

So to get back to having a very large amount of wealth come your way by being successful, it seems the greater the amount of wealth one obtains, the greater influence simple uncontrollable/unforeseeable luck was involved.

 

[tkingdoll]

Pardon, but you don't get to dictate the only definition of luck applicable to this thread.

Luck, by my definition, which I believe is quite relevant to this discussion, is a resulting outcome arising from a risk which is at least one standard deviation greater than the expected value.

Buying a lottery ticket has an extremely negative expected value. Winning the lottery is well beyond two standard deviations from expected value.

Bill Gates, as a kid, with zero credentials or experience, managing to sell an entirely novel software programming language interpreter embedded on a semiconductor, to the world's largest computer company, at a time when the idea of a personal computer was still mostly science fiction at IBM, was probably a more unlikely event than winning the lottery.

He didn't just have the right genes -- he had a father who happened to have the right job as a legal advocate for the right company.

The odds against all of these things coalescing at that one moment in history makes winning the lottery look like a coin toss.

Most great discoveries are the result of luck after years of trying. Most celebrities are who they are because they were lucky enough to be in the right place at the right time.

The average accountant, doctor, lawyer or academic professor has not led a particularly lucky existence. He/she is talented and follows a predetermined path to reasonable success via that pass.

And for that person, IQ and income are synonymous. But, for the rest of the world -- the guy that opens the coffee house or the pizza joint or the jewelry store, and who happens to end up with a chain spread out across the world -- that guy is successful because he is lucky that when he first opened his coffee house -- the mall manager didn't lease to Starbucks a month later.

In a world where everyone is competing -- the result of that competition makes everyone pretty average. What separates us is mostly luck -- and if you don't recognize that reality, then my friend, you've either been incredibly lucky, or you haven't risked much during your lifetime.

If you had, you would understand what I'm writing about.

Clearly, you haven't read ANY of the information about luck that I provided. If you can't be bothered to do even some basic cursory research then I'm not going to discuss this with you. The research on luck addresses everything you've said above. However, you seem to think that Bill Gates did nothing whatsoever and billions just fell into his lap, so there's most definitely no point in discussing this with you. If you can't see how luck in the context of careers is the application of initiative to opportunity, then there's no point in continuing. Plus, you seem to have decided to turn this into some sort of weird thing where you make assumptions about my personal life.

This is the internet, and I am most assuredly not your friend.

 

[rocketdodger]

To answer the original post -- apply common sense.

Clearly, all else being equal, more intelligence leads to greate success in any endeavor, including the ability to earn income.

Clearly, all else being equal, having more resources to learn with can increase cognitive ability.

This question only become interesting when you remove the "all else being equal" clause. That seems to be what everyone is arguing about, I suppose.

 

[kjkent1]

Clearly, you haven't read ANY of the information about luck that I provided. If you can't be bothered to do even some basic cursory research then I'm not going to discuss this with you. The research on luck addresses everything you've said above. However, you seem to think that Bill Gates did nothing whatsoever and billions just fell into his lap, so there's most definitely no point in discussing this with you. If you can't see how luck in the context of careers is the application of initiative to opportunity, then there's no point in continuing. Plus, you seem to have decided to turn this into some sort of weird thing where you make assumptions about my personal life.

This is the internet, and I am most assuredly not your friend.

Can't see? I can see plenty. Obviously, someone who works smarter than the competition will obtain better results.

But, that's not what we're talking about here. We're talking about whether there is a high correlation coefficient between IQ and income. My position is that within the 1st positive and negative standard deviation, there is probably a high correlation coefficient.

Outside of that range, it don't mean squat. Nearly every single one of the wealthiest 1% of society is in that rarified air because they were lucky beyond the reasonable measure of the risk they encountered.

I do a lot of estate planning for a living. My clients usually have between 2 and 20 million in net worth. I get to review all their assets and liabilities and discuss their lives and their desires, and my anecdotal experience is that I have never met a single person who accumulated more than $1,000,000 in net worth during his/her lifetime that wasn't clearly lucky -- lucky to be in the right place at the right time -- lucky to be born into the right family -- lucky to have made a life choice which was effectively a 50/50 risk that turned out unbelievably well, etc.

So, I really don't care about psychological research. I care about bank accounts and life stories. And, when you get to the nub of the issue -- in the end -- the dominant factor that distinguishes between great financial success and mediocrity is not determination, or intelligence. It's luck. Blind, dumb, random, ignorant chance.

...believe it or not!

PS. I apologize if I've offended you. I get paid to argue with people, so it sort of comes with the territory.

 

[hammegk]

I do a lot of estate planning for a living. My clients usually have between 2 and 20 million in net worth. I get to review all their assets and liabilities and discuss their lives and their desires, and my anecdotal experience is that I have never met a single person who accumulated more than $1,000,000 in net worth during his/her lifetime that wasn't clearly lucky -- lucky to be in the right place at the right time -- lucky to be born into the right family -- lucky to have made a life choice which was effectively a 50/50 risk that turned out unbelievably well, etc.

Nothing like a good anecdote ...

Since you got to know your clients rather well, how many reminded you of Forest Gump, vs how many appeared "smarter than the average bear"?

 

[Just thinking]

Nothing like a good anecdote ...

Since you got to know your clients rather well, how many reminded you of Forest Gump, vs how many appeared "smarter than the average bear"?

Unfortunately I can only claim intimate knowledge of one family that lives in a +1 million dollar home. The primary income earner is what would be commonly known as a schmoozer. A slick talker (he's a stock broker) --- but as far as "smarter than the average bear" --- no way!

And I knew of someone's spouse (a co-worker) who became very wealthy --- but had a great deal of start-up help from the family by marriage (read money and connections).

 

[kjkent1]

Nothing like a good anecdote ...

Since you got to know your clients rather well, how many reminded you of Forest Gump, vs how many appeared "smarter than the average bear"?

Forrest Gump is a caricature of reality -- but, reality is not that far afield. Real geniuses are usually happy just knowing that others can't keep up intellectually. They rarely view money as the ultimate reward. Knowledge is the reward or them. Same for great musicians -- it's about the music.

Most people know their particular business/occupation well enough to compete in the market. But, that doesn't make them wealthy. It just pays the bills. Here's some examples:

1. Service manager for BMW dealer. Business is doing bad, so he offers to take it off the hands of the management. They say fine and walk away. Business comes back due to the economy improving. Service manager sells and walks with seven million.

Opportunistic? Brilliant? Lucky? I'm going with #3.

2. Secretary for Microsoft Corp. Never sells any of her small stock options. Stock splits 20 times, she's worth $25 million. Smart or Lucky? Duh...

3. Anna Nicole Smith's child. When the dust settles on Howard Marshall's estate, the kid will inherit $80 million. Mom was a stripper picked up by an old horny billionaire. She's not getting the money because of the marriage or divorce. She's getting the money because Pearce Marshall (Howard's son), materially falsified evidence to the bankruptcy court, so the court spanked him in proportion to his wealth.

Smart or just a long line of bizarre twists and turns? Luck -- nothing else involved.

4. At 19, man opens a "head shop" in Venice Beach, CA during the 60s. Sells "leather" goods. LOL! Friends own a shop where they make leather sandals. They decide to move to Hawaii to surf. First guy takes over the store. Turns out that the Mexican who tools the sandals for the store is really creative. They start tooling electroplate silver belt buckles. People like them. Private company now has 190 retail stores and 6,000 independent dealers -- ONE owner -- same guy. Revenue: $150 million a year. Mexican still sits in the back and tools silver belt buckles. Only now there's a dozen guys tooling new designs.

Genius businessman, or in the right place at the right time? No comment.

5. Guy opens Army Surplus store. Has partner who's an accountant. Accountant refuses to take any risks. One day accountant drops dead at his desk. Other partner starts selling used Levis and country western shirts. Then new Levis. Opens store in strip mall. Calls it "Miller's Outpost." People like the mix. He opens some more stores. Then he buys the strip mall. Real estate appreciates. Then he buys a bigger mall. Pretty soon he's building the malls and putting his stores in. Finally, he sells the biz to a Canadian conglomerate for $80 million, but he keeps all his real estate holdings which are worth 10 times that much. Business name is changed to "The GAP."

Miller still drives around in an old Ford Town and Country Wagon with imitation wood on the sides. Lucky or genius? He says, "If my accountant hadn't of died, I would never have tried to sell anything different."

6. Saving the best for last. Mediocre trumpet player working bar mitzvahs and weddings around L.A. Has friend who works for Capitol records as a low level record promoter who takes new cuts to local radio stations to try to get airplay.

Trumpet player cuts one song in the studio and calls it "Twinkle Toes." Stupid sounding -- no one cares.

One weekend, the two friends go to the bull fight in Tijuana, MX. One guy says, "Hey, ya know, we should just record some of the sounds in this stadium and put it behind your twinkle toes thing?" Trumpet player says, "Okay, why not...it's never gonna sell anyways."

They changed the title to "The Lonely Bull," and damned if the record didn't sell of the shelf. People thought he was this slim matador-looking guy from Spain -- in reality, he was a Russian Jew from west L.A.

This is the story of "Herb Alpert and the Tijuana Brass." During his time, Herb outsold the Beatles for a few years.

Genius, or Lucky?

You can say whatever you want. Herb will say, "Lucky -- but, you can call me a genius -- I won't mind!"

We are all separated by the things which we cannot control -- not those that we can. When someone tells me otherwise, they're usually under 40 years old. By the time they reach 70, they usually will candidly admit that most of what they have fell into their lap when they least expected it.

Luck may be the moment when opportunity meets preparedness. But without that opportunity -- it don't mean nuttin how prepared you are.

PS. I've seen the "other" side of this coin. The person who had it all go'in on and was destroyed by forces beyond his control. But this is a holiday and we're supposed to be thankful for what we've got -- so, I'll let the downside stay quiet and simply say:

Happy Thanksgiving to All!

 

[Just thinking]

Happy Thanksgiving to All!

And back at you and your family!

Thanks .... that was a great read.

[PS: Perhaps you'd like to go here to read a thread I started a while back --- sort of reflects your comments well.]

 

[bpesta22]

These all read like person-who statistics which are pretty much anecdotes + selection bias-- in other words, worthless as evidence.

I think it's important to remember this is a correlation, but it's also an effect size (.33-.40). There's a moderate effect of IQ on SES (but is it causal?).

Being only moderate, there will be 1000s of exceptions to the rule (person-who people) but that doesn't invalidate the effect. I posted something here awhile back about effect sizes for various medical treatments. Many well accepted "treatments" for various diseases have effect sizes far smaller than .33. And, if income levels are indeed partially caused by IQ, at a societal level, this would have very important practical implications.


Smart people make money, or making money makes you smart?

Smart people go to ivy league schools, or ivy league schools make you smart.

Smart people get better jobs and live in the suburbs, or living in the suburbs with the better job makes you smart.

 

[DocTwisted]

The standard IQ test alone is insufficient to determine one's level of success.

As an example, there's... well, me. I have an IQ of about 165, which qualifies me for MENSA membership. I'm on the right-hand side of the ol' bell curve on IQ.

I've spent the whole of my life since graduatiing high school struggling financially, living below the poverty line. I dropped out of UC because I couldn't afford to finish my BA. I almost flunked out first, because I was having issues with depression that made me unable to focus on anything, especially my studies. I'm currently working a $9/hour retail job. If it were possible to just "think" your way into an honest job that paid well, I'd have done it years ago.

 

[Dancing David]

For Athon.

In my worldview (where the sky is blue!) one's IQ causes how successful he/she will be in life and how much money he/she will make (or Socio Economic Status-- SES).

Many would argue the opposite-- that the environment and opportunity you get as a kid (with SES being a crude measure of this) determines how smart you are.

If anyone wants to debate this for 10 pages, this is the thread!

Here's one quick study I found on it-- not sure of the journal, and it's on older people versus everyone, but:

http://www.pubmedcentral.nih.gov/articlerender.fcgi?artid=1971068

Conclusion
Rather than developmental and socio-economic characteristics of early life, the findings substantiate the importance of intellectual abilities for functional decline and their contribution – as potential, but neglected confounders – to socio-economic differences in functioning, successful aging, and quality of life. The higher intellectual abilities in the higher socio-economic status groups may also underlie the higher prevalences of mastery, self-efficacy and efficient coping styles in these groups.



Note that the theme of the bell curve was my argument above, though I won't use it as evidence here, since many people seem to think it's not good science.

In the past you cited a twenty five percent correlation, is that still the case?

What about the other seventy five percent?
Have you got it up to the high sixties yet?

 

[Roboramma]

The standard IQ test alone is insufficient to determine one's level of success.

As an example, there's... well, me. I have an IQ of about 165, which qualifies me for MENSA membership. I'm on the right-hand side of the ol' bell curve on IQ.

I've spent the whole of my life since graduatiing high school struggling financially, living below the poverty line. I dropped out of UC because I couldn't afford to finish my BA. I almost flunked out first, because I was having issues with depression that made me unable to focus on anything, especially my studies. I'm currently working a $9/hour retail job. If it were possible to just "think" your way into an honest job that paid well, I'd have done it years ago.

I hear you. Well, except on the IQ of 165 thing...

Anyway, there are plenty of reasons that a smart person won't be a huge financial success. A lack of interest in those feilds or occupations at which one can make a good deal money, for instance. Lack of other faculties - for instance I've never been much of a people person, am a bit of (that's a major exageration) a procrastinator, and have a few other faults. Simple bad luck - and I don't mean Teek's sort of bad luck, I mean simply not having the opportunities that one could capitalise on.

For instance, I had the good luck of landing a good job in Hong Kong paying about 2.5 times what I could have made in canada right after finishing the training I needed to qualify for it (actually while I was still finishing). Why? I happened to have a family connection. That job, which only lasted six months, opened up the opportunity for me to get more training elsewhere, which helped me get a better job (actually with the same company in HK) which led to more training, which led to it being easy for me to get a job now - even if the pay is never going to be extraordinary.

So, for instance, if I hadn't, by chance, had that family connection things would have been much more difficult. If I were to be severly injured or become severly ill I wouldn't be able to work (my job is quite physical). So that sort of bad luck could lead to serious problems. Etc.

However, none of this suggests that IQ doesn't corellate with success. The question bpesta seems to be interested in is whether IQ of sucessful people is high because:
1. IQ is raised by being exposed to a good education, and people who have access to a good education also have access to the other things that make having a high income more likely.
Or
2. IQ simply leads to increased income because smarter people are better at doing what it takes to get good jobs - for instance they are better at school, better at the jobs that they get, better at recognising opportunities, etc.

Personally I vote for a combination of 1 and 2.

 

[DocTwisted]

Oh, well if that's the question at hand, I misunderstood a bit.

I recall reading in a few places (I think primarily in Psychology Today) that some tests have shown that mental stimulation over time can raise IQ, especially during development (during the time the brain is still growing). Sorry I don't have any links handy, but I'm barely awake right now due to the levels of turkey in my system.

Anyway... if the above is true, than IQ can be boosted by people already having a richer start, so long as the parents are aware and spend the time (of which they will have more of than someone who needs to work 2 jobs to get by) to stimulate that growing mind.

 

[suicidesamurai]

The standard IQ test alone is insufficient to determine one's level of success.

As an example, there's... well, me. I have an IQ of about 165, which qualifies me for MENSA membership. I'm on the right-hand side of the ol' bell curve on IQ.

I've spent the whole of my life since graduatiing high school struggling financially, living below the poverty line. I dropped out of UC because I couldn't afford to finish my BA. I almost flunked out first, because I was having issues with depression that made me unable to focus on anything, especially my studies. I'm currently working a $9/hour retail job. If it were possible to just "think" your way into an honest job that paid well, I'd have done it years ago.

So you are highly intelligent but struggled with depression and had a lack of motivation. You could have succeeded without those afflictions. But try getting a person that is highly motivated yet with an IQ of 78 into a UC school. It doesn't work the other way around. You can go down, but they can't go up. That is the importance of intelligence.