ERIC Number: EJ772607
Record Type: Journal
Publication Date: 2007
Do You Have to Be Smart to Be Rich? The Impact of IQ on Wealth, Income and Financial Distress
Zagorsky, Jay L.
Intelligence, v35 n5 p489-501 Sep-Oct 2007
How important is intelligence to financial success? Using the NLSY79, which tracks a large group of young U.S. baby boomers, this research shows that each point increase in IQ test scores raises income by between $234 and $616 per year after holding a variety of factors constant. Regression results suggest no statistically distinguishable relationship between IQ scores and wealth. Financial distress, such as problems paying bills, going bankrupt or reaching credit card limits, is related to IQ scores not linearly but instead in a quadratic relationship. This means higher IQ scores sometimes increase the probability of being in financial difficulty.
Descriptors: Probability, Income, Financial Problems, Credit (Finance), Intelligence Quotient, Baby Boomers, Statistical Analysis, Intelligence Tests, Money Management
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Publication Type: Journal Articles; Reports - Research
Education Level: N/A
Authoring Institution: N/A
Identifiers - Assessments and Surveys: National Longitudinal Survey of Youth
Grant or Contract Numbers: N/A