You’ve probably heard of intelligence quotient (IQ) tests. You may even have taken an official one. But even if you believe an IQ score is a legitimate marker of intelligence, research suggests other characteristics are more important in determining whether you’re likely to be successful financially.
Smart people should be more successful, right? You’d be right to assume the more intelligent you are, the higher your wages will be later in life. But that’s not always the case. A working paper from the University of Chicago titled What Grades And Achievement Tests Measure sheds light on the debate. We’re here to sift through the numbers and pull out what matters.
What is IQ?
IQ stands for intelligence quotient. It’s a score based on the results of a series of standardized tests. The purpose of these tests is to assess human intelligence.
The abbreviation “IQ” goes back over 100 years to a German psychologist called William Stern. However, concrete measurements of human intelligence are naturally impossible to make.
Therefore, we have to think of IQ test scores as suggestive or indicative of intelligence, or something like intelligence, rather than immutable evidence of something rock solid.
IQ scores can be useful predictors of job performance and, to an extent, income. And educational administrators sometimes use them to place students.
In the English-speaking world, the most commonly used individual IQ test series is the Wechsler Adult Intelligence Scale, or WAIS. There’s an equivalent for children, too. But there are numerous others in regular use.
How important IQ is as a determining factor for income
You might think that people with higher IQ scores naturally end up making more money than people with lower scores. Well, if that’s true, it’s only true to a small degree. Partly this because so many other factors are at play in the real world. And partly, it may also be because someone with a high IQ score could simply choose not to work in a field that pays well.
The University of Chicago published a working paper in 2016 titled What Grades And Achievement Test Measure. It contains some illuminating charts and graphs about IQ and several other human characteristics.
In one figure, personality was said to be almost double more effective for higher wages than intelligence, and IQ and personality together were even better.
The researchers found that, while IQ scores can appear to be useful in predicting wage, “after controlling for scores on achievement tests, IQ loses around 60% of its predictive power”. In other words, it’s less useful than we think – less useful than it appears.
“When grades are included, instead of achievement tests, the effect of IQ becomes negligible.”
Your personality is more important than your IQ
Heartening news for anyone concerned about receiving a low IQ score after a recent test. Or indeed for anyone avoiding taking an IQ test in the first place, out of fear they’ll come back with a low score.
Taken together, attributes like “self-esteem, locus of control, anti-social behavior, and neuroticism” are in fact “more important determinants of wages”. That’s compared to IQ. Oh, and LinkedIn can help with success, too!
Different schools of thought group different traits together under the umbrella term “personality”. Some use the so-called “Big Five”: openness, conscientiousness, extraversion, agreeableness, neuroticism.
These results matter, say the researchers, because “personality or non-cognitive skills are more malleable at later ages than IQ”. This means you can do more to help someone develop their personality traits than you can boost their IQ. They emphasize “interventions” that can promote personality among adolescents, but which are “much less successful in boosting IQ”.
“The predictive power of grades shows the folly of throwing away the information contained in individual teacher assessments in predicting success in life.”
In other words, they’d like to see more emphasis placed on individual teacher assessments than on IQ tests. This would help teachers help students better. And in the long run, help society to become more productive, healthier, and better adapted.
