Why Dumb People Earn More Than Smart People

Introduction

In a study conducted by researchers in Sweden, it was discovered that top earners actually have lower intelligence levels compared to those just below them in terms of income. The study looked at data from 59,000 men who had taken a military conscription aptitude test and tracked their earnings over their professional careers. While this may seem counterintuitive, there are a few reasons why this phenomenon exists.

The Intelligence and Income Relationship

The study found a strong correlation between intelligence and income, with smarter individuals earning more money. However, this relationship began to plateau at around 670,000 Swedish krona (equivalent to $64,000) per year. Beyond this point, intelligence no longer had a significant impact on income. Surprisingly, at the very top end of income earners, the one percent, less intelligent individuals actually performed better financially.

The Role of High Prestige Jobs

One reason why less intelligent individuals may outperform their smarter counterparts in terms of income is that smart people often fill high prestige jobs that lack high salaries. Academics, research scientists, and other highly intelligent individuals often end up in professions where their intelligence is not financially rewarded as much.

Even though these professions require exceptional intelligence, they may not lead to the same level of financial success as professions such as business ownership.

Business Ownership and Income

Business owners, especially those earning over half a million dollars per year, do not necessarily need to possess genius-level intellect. While they still need to be intelligent, they don't need to be as smart as occupations with higher barriers to entry, such as top surgeons. This is because business ownership provides a unique opportunity for financial success.

For highly intelligent individuals who are already earning good incomes in other fields, the transition to business ownership may be less appealing. They may already be satisfied with their current income level and unwilling to take the risk of starting a business. On the other hand, individuals with moderate intelligence who desire high incomes are more likely to take the risk because they don't have as many high-paying opportunities in traditional career paths.

The Complexity of Wealth

While this study sheds light on the relationship between intelligence and income, it is important to recognize that wealth is influenced by various factors beyond intelligence alone. Family connections and nepotism can play a significant role in landing high-paying jobs, regardless of intelligence. Additionally, luck and the unpredictable nature of business success can contribute to a person's financial standing.

Career Planning and Intelligence

If your goal is to maximize your income, it can be tempting to try to replicate the success of the top one percent. However, doing so may overlook the statistical complexities involved in reaching that level of wealth. The study's findings should not be interpreted as a clear roadmap to financial success.

Instead, individuals should focus on assessing their own skills, strengths, and weaknesses honestly. Choosing a career path that aligns with one's abilities and marketable skills can lead to greater success than simply chasing high-paying jobs based on reputation.

Conclusion

While it may be surprising to learn that less intelligent individuals can earn more money than their smarter counterparts, it is crucial to understand the multiple factors that contribute to wealth. Intelligence is just one piece of the puzzle, and individuals should focus on self-assessment and choosing career paths that suit their abilities. Ultimately, financial success is influenced by a combination of intelligence, hard work, luck, and various other circumstances.