Investigating the Relationship between National Wealth and National IQ

Psychologists and economists have employed mean national IQ as a human capital variable to characterize a nation’s potential for economic growth. While previous studies consistently show a high positive correlation between a nation’s average IQ and its wealth, there is disagreement regarding the reason behind this relationship. Some believe high IQs facilitate economic growth while others believe wealth explains why IQs vary across nations. To address this uncertainty, this study analyzes retrospective observations across time within a wealth-equated sample of underdeveloped nations. The correlation between the level of economic growth experienced by the nations sampled and their average IQ across five decades was r = .74 (R² = .548). Statistical tests demonstrate that high IQ nations displayed significantly more growth and that nations experiencing more growth had higher IQs. These results support the use of average national IQ as a human capital variable and demonstrate its causative role in economic growth.