Aldo Rustichini is a genial Italian economist with a head of hair that seems to have been modelled on Albert Einstein’s. A professor at Cambridge and the University of Minnesota, he quickly transformed my interview with him into a full-blown undergraduate-style tutorial, occasionally asking me questions to check my understanding. Yet this likeable economist has been carrying out work with potentially explosive implications – including the possibility that economic success is genetically transmitted.
Rustichini’s latest research – with Stephen Burks, Jeffrey Carpenter and Lorenz Goette – studies the behaviour of about 1,000 trainee truck drivers in the US. The researchers gave the truckers IQ tests and asked them to participate in a number of small experiments.
In one experiment, the truckers were asked to choose between gambles and certain payoffs. In another, the choice was between a sum of money now and more money later. A more complex experiment required the truckers to play an anonymous “trust” game. The first player was given $5 and offered the choice of sending it to the second player; the second player had his own $5 and was asked how much he would send to the first player were he to receive $5 from him, and how much if he didn’t. The researchers promised to double the money sent in either direction – meaning that if the players managed to co-operate then each could get $10.
An intriguing pattern emerged. The truckers who scored highest on the IQ test were also more patient and more willing to take calculated risks, rejecting unfair gambles and accepting favourable ones. Their choices revealed a more consistent attitude to risk and a more consistent level of patience, too.
The high-IQ truckers were also better at predicting what other players would do in the trust game, and secured more money overall. When they played second, they were more discriminating, rewarding co-operation and punishing those who would not trust them.
High IQ goes hand in hand with patience, calculated risk-taking and interpersonal judgment, it seems – and this is true after statistically adjusting for age and race.
Nor is any of this limited to the laboratory. Many trainee truckers drop out before completing their first year of work, even though this means they must repay the trucking company their training costs, which run into thousands of dollars. This indicates a lack of patience, an inability to appreciate how much money is at stake or a serious miscalculation in the initial plan to be a truck driver. Whatever the reason, dropping out is correlated with Rustichini’s experimental tests of low IQ, impatience and bad judgment of risk or of other people.
Rustichini puts this in a far more striking way: that the ingredients for prospering in a capitalist society all seem to be present together, or absent together. This is not entirely surprising but neither is it obvious. And therein lies the dangerous hypothesis: if all these attributes go hand in hand, it is much more plausible to suggest that economic success is passed on from generation to generation.
“Such a process could be cultural, genetic or both,” comment the researchers in a footnote, “but the genetic version is the most controversial.” Quite so. But even the cultural transmission of economic success is a provocative notion, and a painful one to most economists, who are predisposed to hope that good policies alone may promote economic growth.
Rustichini is not perturbed. For all his amiability, he is quite content to contemplate unwelcome possibilities.
Also published at ft.com.