Income Inequality and IQ (AEI Studies on Understanding Economic Inequality)

This work examines the relationship between economic inequality and Intelligence Quotient (IQ), to see how much of observed income inequality is attributable to differences in earning capabilities that are closely associated with differences in cognitive ability. The importance of intelligence quotient (IQ) to income is analyzed using data from the National Longitudinal Survey of Youth, a study that began in 1979 with 12,686 subjects. Data for this study go through the 1994 interview wave, so that the most recent income data is for 1993. Statistical techniques are used to separate the influence of IQ from the influences of family background. The comparison of siblings who grew up in the same home, but who have different IQs shows that brighter siblings have more education and higher level occupations and are employed more of the time. The data are also used to explore the question of whether the elimination of poverty and ensuring that all children are born into intact families would decrease income inequality in succeeding generations. The analysis suggests that those of below-average intelligence would still earn less than their peers with higher IQs. It is concluded that policy analysts must stop avoiding the reality of human inequality. (Contains 17 tables and 17 endnotes.) (SLD) Using data from the National longitudinal Study of Youth, argues that intelligence quotient has an important effect on income independent of family background