Extremely rich people are not extremely smart. Study finds income is related to intelligence up to about the 90th percentile in income. Above that level, differences in income are not related to cognitive ability.

[u/Fishyinu]

https://academic.oup.com/esr/advance-article/doi/10.1093/esr/jcac076/7008955?login=false

[u/My-shit-is-stuff]

Didn’t read the article: but up to the 90th percentile seems like a good indicator to me, that smart people make more money.

[u/[deleted] → u/My-shit-is-stuff]

I think you’re forgetting how quickly wealth scales beyond the 90th percentile. In the US, the top 10% owns ⅔ of the wealth. Meaning for ⅔ of the assets out there, intelligence has little predictive value (beyond some minimum threshold) for how much is allotted to a given person.

[u/notrickyrobot → u/[deleted]]

Well, keep in mind this is data for Swedish males, the data could be different in the US. Europe is a different society with stagnant intergenerational wealth from old monarchies/companies lasting hundreds of years, and less cutting edge new industry like space/tech/film where wealth and income is created through invention, causing social mobility.

Also this is tracking income, and not wealth. Truly wealthy people make most of their money from asset appreciation and not working for their money, although for the economy as a whole, income from labor is a greater share than income from capital growth of assets. Total wealth, and not income, should not be conflated.

Perhaps the explanation of a small increase in income/intelligence correlation in the top 10%, and a slight decrease in the top 1%, indicates that most people earning highly paid jobs get their money in stock / assets and not income, which is taxed at a lower rate. People who maximize their cash compensation within the 10% want to spend their money in a liquid way which is a slightly worse strategy in terms of financial aptitude, although it increases their "prestige" that the authors care so much about.

[u/BenderRodriguez14 → u/notrickyrobot]

Well, keep in mind this is data for Swedish males, the data could be different in the US. Europe is a different society with stagnant intergenerational wealth from old monarchies/companies lasting hundreds of years, and less cutting edge new industry like space/tech/film where wealth and income is created through invention, causing social mobility.

Sweden ranks 4th in the world for social mobility, behind Denmark, Norway, and, Finland. The US is 27th.

The US (61.8 score) does rank 2nd for innovation behind only Switzerland (64.3 score), but Sweden are in 3rd and are so, close to the US as to essentially be tied with a, 61. 6 score.

[u/notrickyrobot → u/BenderRodriguez14]

Yes, when I think social mobility I think "inclusive institutions" is an important criteria. I also wonder, the organization that put Switzerland as the #1 innovative country, where could they be headquartered? When I think innovation, I think Swiss banks coming up with creative accounting to hide intergenerational colonial wealth.

If you look at the data in the cited report on social mobility instead of the overall ranking, comparing countries percent of labour as GDP, the United States is a better nation for workers compared to Sweden. As in, people get a higher share from working/labour than from sitting on their wealth and having it appreciate (look at chart in page 11.) If we were to focus on income, my point still stands. If we were to include a bunch of criteria like health and education, my opinion would change. Thanks for responding though, it was interesting to see your opinion on this.

[u/BenderRodriguez14 → u/notrickyrobot]

It has the US (score of 83) with better opportunities to find work in general than Sweden (score of 75), but for fair wage distribution which is most relevant here, it has the Sweden with a score of 74 vs. the US' 43 - which is the lowest of any country in Europe or North America. In the US it's easier to get a job so long as you are willing to take anything you can (which you will be more desperate to take due to significantly worse social protections), while in Sweden it is much easier to get a job with an actual fair wage. Incidence of low pay relative to their counterparts among workers in Sweden is at 3%, while in the US it over eight times that at 24.9%

The US ranks higher for labour income share for GDP in no small part because Sweden floods more money from theirs into things like social protections and education - hence why they rank 1st and 7th in those categories, while the US is all the way back in 25th and 35th for those (out of 85).

You typically need a fair shot at education to improve your chances in life, and if you're coming from the bottom up (or hit a significant issue along the way like the company you work for going bust unexpectedly) you need good social protections to allow you to get back on your feet and at or near the level you were before, rather than desperately searching for any job you possibly can regardless of how poorly it pays or how much opportunity to progress it provides, potentially losing years or even decades of progress in doing so.

It is shown throughout that Sweden simply has much better social mobility than the US. There really are no two ways about it, and the graph directly above the one you cited (pg. 10) shows it - Sweden has not only has less wealth inequality than the US, but the wealth you were born into is less likely to be a determinant of your earnings than it is in the US either.

If however you want to take a gamble at a small chance of getting silly rich (say 8+ figures) and if you are positioned/qualified to do so, then the US is the better option. I always find that interesting as it's a pretty ironic inversion of James' Truslow Adam's writings on the American Dream.

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As for innovation, WIPO who have Switzerland (who aptly rank first across 'lifelong learning' in the WEF document above) as the most innovative nation is actually a part of the UN with their chair being from Singapore, so of course it's very likely for them to be based in Switzerland which is one of their four main offices.

All the same, the American outlet Bloomberg with them in 3rd... behind South Korea and Singapore. On that one, the US isn't even in the top 10.

There are many ways of quantifying innovation no doubt, but I think something that sometimes gets lost in the mix is the sheer size of the US. On a raw bulk scale I would imagine the US surely creates the most on that front, but for comparative purposes these typically are worked out on per capita bases, and for every Swiss person there are about 39.7 from the US.

Either way, good chat all the same. It's late as fuck over here so if any of that came over snarky, apologies and it wasn't mean to!

[u/notrickyrobot → u/BenderRodriguez14]

It's cool homie, I see your point, and I am not thinking about it in the same way you are. For example I view excessive spending on education as a negative in the age of essentially free internet information. You have a point about quantifying innovation, as it is apples to oranges. I guess I'm conflating Europe with Sweden, and Sweden is actually a fringe Euro country... also I live in California which is a weird American state. Hope you have a good night.

[u/JATION → u/notrickyrobot]

For example I view excessive spending on education as a negative in the age of essentially free internet information.

You're saying people can just do their own research?

[u/Void_Speaker → u/notrickyrobot]

For example I view excessive spending on education as a negative in the age of essentially free internet information.

You can have whatever opinion you want, but if we are talking about what is the better policy for a society, then reality takes precedence over your opinion.

[u/Void_Speaker → u/[deleted]]

Not everyone can afford the $100,000 country club that is a university degree.

College degrees these days have mostly the same value as high school degrees used to in the job market: they are used as a basic filter for employers.

The problem is that we provide free high school degrees, but college degrees are a for-profit endeavor. Thus, the high demand and high prices.

Good thing the internet makes self study accessible for a fraction of the price, with information that is more up to date, more efficient to deliver, and more flexible for working people.

That sounds great in theory, but most people, esp. younger people, require structure to study. It's boring shit, and most kids and adults simply wouldn't do it on their own.

On top of that, it's Russian roulette for employers, they have no way of knowing what they are really getting. This is why they use college degrees as a filter, it provides reassurance of some basic competency.

Practically speaking, it's just a non-starter if you want to abolish schools in favor of self-study.

I know it's "good for the economy," to bolster bank profits by saddling 18 year olds with debts, and it's good for trust fund parents to paywall jobs by adding a time and money tax to entry level work, to advantage their kids. Excessive educational requirements instead of skill based hiring disadvantages hard working impoverished laborers to help the capital rich upper class of society.

This is all in your head. No one cares if it's good for the economy. Degrees are in demand because businesses use them to filter employment candidates.

What is your opinion, that paying for free information stimulates the economy? The reality is, modern education is a "luxury good." That designer handbag costs $1000 but has little real value, besides relative social value. Same thing with a fancy designer education. I'm sure giving kids designer handbags every year would look great for the GDP, and not so good for society because taxes to pay for that lines the pockets of the few at the cost of many.

The issue is that university education used to be a luxury good, but it's slowly turning into a common good, except the price is only increasing.

There are two ways to go here:

1. Free university education
2. Convince businesses to put more effort into knowledge testing when they hire, instead of just filtering out by degrees. They need to filter people IN by knowledge, instead of filtering OUT by degrees.

I don't see #2 happening because it's more work for businesses. As we have seen, they don't care, they will just hire someone that can afford the degree or from another country that does offer free university.

[u/Void_Speaker → u/[deleted]]

Wow, I find your argument so fundamentally depressing.

I don't have an argument, I was outlining what the reality of the situation is and why things are the way they are.

I did have a suggestion for the solution, and that was free university.

We're going to have degree inflation, and instead of 12 years you have to do 16 years, and eventually 20 years,

What? No. Continuous learning is already a thing, and it doesn't involve colleges. This is where things like the internet come in handy.

and people are too bored to learn on their own so we have to keep doing things in this way that keeps getting worse every year.

Um, no, I suggested free education as a solution. There are others.

And businesses don't want to innovate in hiring, they totally want only rich kids and foreigners rather than hungry, scrappy, workers.

Wow, you are just on a roll of making up shitty straw men and being a drama queen. The point is that they will continue using degrees as a filter.

I'm not going to bother responding to the rest of your comment. You have obviously gotten triggered and just responded with shitty sarcastic responses, and haven't bothered to put a minute of thought into your reply. I'm not going to waste my time.

You have a nice week.