Economic Growth

Why your nation’s IQ matters more than your own

Jonathan Wai
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This article is published in collaboration with Quartz

We know that intelligence matters at the level of the individual, impacting performance in school, work, and life. Decades of research supports that point. But what if your personal intelligence level doesn’t matter as much as the average level of intelligence of the country in which you live? This is what economist Garett Jones of George Mason University calls the “paradox of IQ” in his new book Hive Mind: How Your Nation’s IQ Matters So Much More Than Your Own.

Jones discovered this paradox when researching the link between IQ and income with his colleague W. Joel Schneider. Within a country, the link between IQ and income appears modest, with one IQ point predicting 1% higher income per person. But across countries, that same IQ point predicts 6% higher income per person. Why would it be that the IQ of the country you live in matters more than your individual IQ for predicting eventual income? This led Jones on a quest to explore some of the reasons why this might be, and potential implications of this paradox, discussed in detail in his new book.

In an interview, Jones told Quartz, “If something appears to matter more for a nation than it does for an individual, that something may well be causing positive side effects.” He described three key paths that may generate positive side effects: the links between IQ and patience, cooperation, and team performance. A fourth path, the productivity of those around you, multiplies the impact of the other three. All these paths are supported by research studies spanning psychology, economics, management, and political science, specifically large research syntheses or meta-analyses.

150518-human capital vs GDP chart

Policies to increase human capital policies tend to make a nation’s economic future brighter.

Intelligence predicts greater patience

Smarter people are more likely to be more patient, delaying gratification and being willing to wait for rewards. A meta-analysis by Noah Shamosh and Jeremy Gray supports this point. Here’s how Jones explains the link: “When you’re more patient you save more [money], and some of that money has a tendency to stay in your home country. So nations with high savings rates tend to have more funds available for business investment. If you have more patient neighbors, you’ll be able to borrow some of their money down the road.”

Intelligence predicts more pro-social behavior

meta-analysis by Sudeep Sharma, William Bottom, and Hillary Elfenbein found that higher intelligence predicted greater win-win, pie-growing, pro-social behavior. Jones explains, “We need political leaders who cut deals rather than start wars, who find ways to grow the economic pie rather than battle over a slightly larger slice. And politicians rarely reap most of the benefits of cooperation: Most of the benefits spill over to the whole nation…In many social settings, but not all, intelligent groups are more cooperative. One reason we’d predict smarter groups to be more cooperative is because they tend to be more patient. And more patient people care more about their reputations, they care more about the long-run benefits that come from building a norm of cooperation.”

Intelligence predicts greater patience

Smarter people are more likely to be more patient, delaying gratification and being willing to wait for rewards. A meta-analysis by Noah Shamosh and Jeremy Gray supports this point. Here’s how Jones explains the link: “When you’re more patient you save more [money], and some of that money has a tendency to stay in your home country. So nations with high savings rates tend to have more funds available for business investment. If you have more patient neighbors, you’ll be able to borrow some of their money down the road.”

 

Publication does not imply endorsement of views by the World Economic Forum.

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Author: Jonathan Wai is a Researcher at Duke University.

Image: Students sit for an exam at a school. REUTERS/Vincent Kessle.

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Economic GrowthEducation and Skills
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