How much wealth is produced by high IQ people?

by JonahS 1 min read14th Mar 201436 comments


Cognito Mentoring aims to help high potential young people self-actualize. As a part of our investigation of where the greatest leverage points are, I've been investigating the aggregate wealth of high IQ people as a class. There's a paucity of good data, and it's very difficult to reason about these things in absence of it, so I'd appreciate any thoughts.

The SAT as an indicator

The Relationship Between the Scholastic Assessment Test and General Cognitive Ability found a correlation of 0.82 between IQ and SAT scores based on 1979 data. Some people have claimed that the SAT has become less g-loaded in recent years, but a large fraction of the most intellectually impressive people who I know in my age group scored 1600 on a scale of 1600.

Longitudinal studies of high IQ children

Who Rises to the Top? Early Indicators (2013) find that people who scored at the 1 in 10k level on the SAT for < 13 year olds had median income of $80k at age 33. This is about 2.5x median income for Americans in general (of all ages), and at the 90th percentile of income for 33 year olds (). There's a confounding factor which is that plausibly people who took the SAT before age 13 came from unrepresentatively wealthy and well-educated families.

The maximum income reported out of the sample of 225 was $1.4 million. I wasn't able to find information on how this compares with other 33 year olds. The income is at about the 99.9th percentile for Americans in general (all ages). On the face of things this doesn't seem impressive, but maybe income of outliers rises dramatically over time.

Tech entrepreneurs

  • Bill Gates famously scored 1590 on the SAT, at a time when many fewer people scored 1600 than people did in subsequent years. He also solved a notable problem in combinatorics as a a college sophomore.  
  • Jeff Bezos graduated summa cum laude from Princeton in computer science
  • Zuckerberg took a graduate course in computer science as a high school student.
  • Drew Houston (Dropbox founder) started programming at age 5 and scored 1600 on the SAT.
  • Steve Jobs tested at the 10th grade level in 4th grade.

This is broadly consistent with "top tech entrepreneurs" having IQ ~145+  (99.8th percentile).

Gates made ~ $100 billion, Jobs would have been ~$100 billion with 20% equity in Apple. Ellison ~$48 B Page $32.3 B, Bezos $32 Brin $32 B, Zuckerberg $28 B, for about $400 billion total. At present, US tech billionaires are worth $355 billion.

Total Wealth of US is $118 trillion. So if it's true that 50% of wealth of tech billionaires is concentrated in those who are of IQ 145+, then such people's wealth  just about accounts for the share of wealth (~0.2%) that one would expect the IQ 145+ population to have if wealth were uniformly distributed. 

By itself, this isn't very informative. What about people of net worth between $100 million and $1 billion? Between $10 million and $100 million? Do IQ ~145+ people have 0.4% of the world's wealth? 2% of the world's wealth? Is 145 the right IQ threshold to be looking at? What about IQ ~130 people (98th percentile)?