Thanks for this. Is there a place where I can see the sources you are using here?
I am particularly interested in the source for this: ”The other graph here is an interesting one. It’s the financial returns to IQ over two cohorts. The blue line is the older cohort, it’s from 50 years ago or something. It’s got some slope. And then the red line is a newer cohort. And that’s a much steeper slope. What that means is basically for every extra IQ point you have, in the new cohort you get about twice as much money on average for that IQ point. ”
FWIW, I am skeptical of the interpretation you put on that graph. I considered the same issue in my original analysis, but went with Strenze 2007′s take that there doesn’t seem to be much steeper IQ/income slope and kept returns constant. Seb objects that the datapoints have various problems and that’s why he redoes an analysis with NLS to get his number, which is reasonable for his use, but he specifically disclaims projecting the slope out (which would make ES more profitable than it seems) like you do:
If the estimate were only based on the more recent cohort (NLSY97), the estimated effect between the ages of 25 and 65 would be $74,508, and adding the rough estimates for the additional years (18-24 and 66-80) increases it to $90,208. I think this estimate is too high; this projection relies on the assumption that the increases in the mean and variance of wages will hold for the future, which may not be the case.
And it’s not hard to see why the slope difference might be real but irrelevant: people in NLSY79 have different life cycles than in NLSY97, and you would expect a steeper slope (but same final total lifetime income / IQ correlation) from simply lengthening years of education—you don’t have much income as a college student! The longer you spend in college, the higher the slope has to be when you finally get out and can start your remunerative career. (This is similar to those charts which show that Millennials are tragically impoverished and doing far worse than their Boomer parents… as long as you cut off the chart at the right time and don’t extend it to the present.) I’m also not aware of any dramatic surge in the college degree wage-premium, which is hard to reconcile with the idea that IQ points are becoming drastically more valuable.
So quite aside from any Inside View takes about how the current AI trends look like they’re going to savage holders of mere IQ, your slope take is on shaky, easily confounded grounds, while the Outside View is that for a century or more, the returns to IQ have been remarkably constant and have not suddenly been increasing by many %.
Thanks for this. Is there a place where I can see the sources you are using here?
I am particularly interested in the source for this:
”The other graph here is an interesting one. It’s the financial returns to IQ over two cohorts. The blue line is the older cohort, it’s from 50 years ago or something. It’s got some slope. And then the red line is a newer cohort. And that’s a much steeper slope. What that means is basically for every extra IQ point you have, in the new cohort you get about twice as much money on average for that IQ point. ”
No central place for all the sources but the one you asked about is: https://www.sebjenseb.net/p/how-profitable-is-embryo-selection
FWIW, I am skeptical of the interpretation you put on that graph. I considered the same issue in my original analysis, but went with Strenze 2007′s take that there doesn’t seem to be much steeper IQ/income slope and kept returns constant. Seb objects that the datapoints have various problems and that’s why he redoes an analysis with NLS to get his number, which is reasonable for his use, but he specifically disclaims projecting the slope out (which would make ES more profitable than it seems) like you do:
And it’s not hard to see why the slope difference might be real but irrelevant: people in NLSY79 have different life cycles than in NLSY97, and you would expect a steeper slope (but same final total lifetime income / IQ correlation) from simply lengthening years of education—you don’t have much income as a college student! The longer you spend in college, the higher the slope has to be when you finally get out and can start your remunerative career. (This is similar to those charts which show that Millennials are tragically impoverished and doing far worse than their Boomer parents… as long as you cut off the chart at the right time and don’t extend it to the present.) I’m also not aware of any dramatic surge in the college degree wage-premium, which is hard to reconcile with the idea that IQ points are becoming drastically more valuable.
So quite aside from any Inside View takes about how the current AI trends look like they’re going to savage holders of mere IQ, your slope take is on shaky, easily confounded grounds, while the Outside View is that for a century or more, the returns to IQ have been remarkably constant and have not suddenly been increasing by many %.