IQ and Poverty: Testing the Bell Curve on a Novel Data Set

Abstract

In their controversial work The Bell Curve, Charles Murray and Richard Herrnstein hypothesize that intelligence plays a significant role in determining later life outcomes. Using data from the 1979 National Longitudinal Survey of Youth, Herrnstein and Murray specifically claim that Youth IQ is more important than Parental Socioeconomic Status in affecting future odds of living in poverty. We explore their hypothesis using the same statistical decisions but on a new data set: the 1997 National Longitudinal Survey of Youth. Our findings mirror those of Herrnstein and Murray; IQ has a larger effect than socioeconomic status on the likelihood of being in poverty, though the overall effect of both is diminished. We find that increasing Youth IQ by one standard deviation is expected to decrease the odds of ending up in poverty by 35 percentage points, compared to the 13 percentage point decrease from similarly increasing Parental Socioeconomic Status.