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The plateauing of cognitive ability among top earners

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Re: The plateauing of cognitive ability among top earners

#191

Post by thethirdone »

I think Figure 3C [0] is best thing to discuss here.

It is very interesting to me that from like from 1% to 10% wage percentile cognitive ability goes down very consistently. It is not clear what societal effect would cause this. My best guess is that among the people without the intelligence to completely pull themselves into the middle class, the smartest find ways of coping without necessarily making more money.

On the opposite side, from 95% to 100% cognitive ability also goes down, but not as consistently. My best guess for this effect would be people with connections / generational wealth are capable of squeezing out more qualified candidates.

0: https://academic.oup.com/view-large/figure/393964189/jcac076...

Re: The plateauing of cognitive ability among top earners

#192

Post by WalterBright »

sidlls wrote: post #188
WalterBright wrote: post #175

Earlier quoted context omitted.

> hard work It is not about working hard. It is about working smart, i.e. working on the right things. You choose those things, it is not luck.

s/hard/smart/g You're making a distinction without difference. I literally had no idea whether the company I work for was even going to go public, much less how successful (or not) it would have been. There was no skill or intelligence involved in picking it. It was pure luck.

And yet you put yourself in a situation where luck could find you. Keep doing things like that, and you'll inevitably get lucky.

Re: The plateauing of cognitive ability among top earners

#193

Post by actually_a_dog »

WalterBright wrote: post #181
actually_a_dog wrote: post #140

Earlier quoted context omitted.

In other words, luck and luck. That is, unless you know how to control what family you’re born into.

If you're in America, you can be a success by making the right choices. Choices like not doing drugs, for example.

Correction: if you're lucky enough to be in America.

Re: The plateauing of cognitive ability among top earners

#194

Post by WalterBright »

pclmulqdq wrote: post #184
WalterBright wrote: post #174

Earlier quoted context omitted.

Luck is the particular details. Not luck is the broad arc of one's career. For example, you're not going to meet a parter sitting in your basement. You meet one by going out and interacting with people. The particular partner you wind up with is luck, but finding someone compatible is not. I.e. the trick is to enable luck to find you . At some point, it becomes inevitable. For another example, stock investing. You ca…

I think a lot of people underestimate the persistence factor. A lot of getting lucky is about getting through the times when you are unlucky. If you can weather the storm, the sun comes out eventually. People like stories of people who bet it all on black and win, though, so they think that's the model for success. Really, the way to win is just to not lose.

That's one way to put it. Another way is you're not going to get rich from stock options if you don't get a STEM job, and you won't get a STEM job without going to college and getting a STEM degree, and you're not going to college unless you stay in school and graduate.

Lots and lots of choices one made to get there.

Re: The plateauing of cognitive ability among top earners

#195

Post by actually_a_dog »

pclmulqdq wrote: post #185
WalterBright wrote: post #179

Earlier quoted context omitted.

> I’d like to know how 1. stay in school 2. pay attention in school 3. go to college 4. don't do drugs 5. don't do crimes This is a solid ticket for anyone wishing to get into the middle class.

You forgot: 6. Don't have children out of wedlock That derails a lot of people.

Also, "be born in, or be able to get to a country that has enough opportunities."

Re: The plateauing of cognitive ability among top earners

#196

Post by WalterBright »

actually_a_dog wrote: post #193
WalterBright wrote: post #181

Earlier quoted context omitted.

If you're in America, you can be a success by making the right choices. Choices like not doing drugs, for example.

Correction: if you're lucky enough to be in America.

Millions of people come to America. Just in my neighborhood there are Indian, Chinese, Korean, Vietnamese, Japanese, and Iranian first generation immigrants. I often hear Russian at the local park. The local real estate agent is first gen Romanian. A good friend is a Polish immigrant. I've run into three first gen Afghan immigrants nearby. The other two members of the D Foundation BoD are Romanian and Turkish. My mother was an immigrant. My sister married an immigrant.

They all came to America by choice.

In fact, America is a nation of immigrants. They came here to establish a country based on freedom, and took advantage of that freedom.

Any country could do what America did, if their citizens chose to.

Re: The plateauing of cognitive ability among top earners

#197

Post by madaxe_again »

sublinear wrote: post #6
madaxe_again wrote: post #3

This study looks only at Swedish men who served in the military, which as the authors observe may well introduce a bias. They also note that a possibility is that higher cognitive ability individuals may more frequently opt for worse paying but prestigious roles, such as academia. I buy it, but I think there’s another factor today, which is that many higher cognitive ability individuals simply are not in the job mark…

How does chasing prestige or avoiding work indicate "higher cognitive ability"?

They looked at cognitive tests carried out when these men enrolled in the military, and then looked at what they are earning now - they don’t attempt to forecast cognitive ability from occupation or income level, they just show a correlation.

Re: The plateauing of cognitive ability among top earners

#198

Post by actually_a_dog »

WalterBright wrote: post #196
actually_a_dog wrote: post #193

Earlier quoted context omitted.

Correction: if you're lucky enough to be in America.

Millions of people come to America. Just in my neighborhood there are Indian, Chinese, Korean, Vietnamese, Japanese, and Iranian first generation immigrants. I often hear Russian at the local park. The local real estate agent is first gen Romanian. A good friend is a Polish immigrant. I've run into three first gen Afghan immigrants nearby. The other two members of the D Foundation BoD are Romanian and Turkish. My mot…

Great. Now what about the other ~7.5 billion people out there? It's extremely elitist to say that anyone who wants to succeed should "just" get to America. Even if you wanted to claim that just touching the shores of the USA meant automatic success (and I am not suggesting you are), not everyone literally can do that.

Re: The plateauing of cognitive ability among top earners

#199

Post by toomuchtodo »

Teever wrote: post #118
jandrewrogers wrote: post #106

Earlier quoted context omitted.

Many people with your net worth grind it out without any windfalls, the product of consistent hard work and reasonable choices over decades. It was always a possibility. Most people don't require an IPO to achieve that. Luck can accelerate that outcome but it is not necessary in any meaningful sense. It requires significantly greater extremes of wealth before luck plays a more frequent role. I know people well into 8…

Yes, and for every one of those people, there's at least a child or two of theirs who again is back to the completely lucked out scenario because they were born to into a wealthy life, so in the end, it seems like luck plays more of a factor in success than hard work.

Luck, like capital, is all about compounding.

Re: The plateauing of cognitive ability among top earners

#200

Post by 1659447091 »

1659447091 wrote: post #144
jandrewrogers wrote: post #106

Earlier quoted context omitted.

Many people with your net worth grind it out without any windfalls, the product of consistent hard work and reasonable choices over decades. It was always a possibility. Most people don't require an IPO to achieve that. Luck can accelerate that outcome but it is not necessary in any meaningful sense. It requires significantly greater extremes of wealth before luck plays a more frequent role. I know people well into 8…

> They worked hard and smart for decades with nothing that you could identify as being particularly lucky. Being born in, or allowed passage into, a society that allowed one to do so in the first place is considerably lucky.

Added to clarify: To say "nothing that you could identify as being particularly lucky" is overlooking what Warren Buffet would call the "ovarian lottery" [0]. The average woman born into, say a rural Taliban stronghold and conservative household with many brothers and uncles is unlikely to ever have even a remote chance at being able to "work hard and smart" to become independently wealthy. So if not being born into that situation, is not considered lucky in terms of being able to create wealth, then are we only talking about luck after that fact? Just chopping off that inconvenient truth because it is so far removed from the blue-collar working class that grinds their way to a decent retirement? I come from a blue-collar working class family from the US mid-west that were heavily involved in the old union movements, and ignoring the above truths is something I was raised to believe - because "anything is possible with hard work and elbow grease". Sure, as long as you are lucky enough to be able to do so in the first place, but I guess that's not considered luck here?

[0] https://www.cnbc.com/2018/10/16/warren-buffett-says-being-a-...

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