I think it's a bit dangerous to put up the graphs and leave them at that without any explanations.
There is a lot of sociological stuff to unpack here.

these graphs, i feel, fail to consider that there are a higher amount of people with lower IQs, thereby making the graph appear equally distributed in wealth.

Re second chart, "This suggests that there is some meritocracy in the distribution of income" ... No, definitely not; this suggests instead wealthy families hanging on to their wealth and maintaining status quo despite having idiots in family. Who needs IQ when you have a national infrastructure watching out for interests of the wealthy. I'm just stunned by the idiocy of the notion of meritocracy at the core; go see Wikipedia's analysis of wealth inequality, to start with, and get a little smarter. I love this blog, but every now and then the blindness revealed here is stunning.

This makes some sense, since wealth is much more inheritable than income. Although there is a genetic component to IQ, and even more so a heritable component that depends on how your parents raise you and what resources they have to foster your cognitive development, it's by no means a perfect correlation. High IQ parents can have children with severe learning and developmental disabilities, etc. So parents with above-average IQs and correspondingly higher incomes are providing their lower-IQ children with wealth that doesn't match their own income.

Also, I find it interesting that the chart stops at 130, two standard deviations above the norm. While it is difficult to measure IQ below 70, it is easily measured above 130, and in fact most "creative producers" - those people who make a significant and creative contribution to their field, such as scientists - have IQs above 130. Basically, there are entire job markets (like most of academia) that are not represented in the graph.

Good old genetic regression to the mean.

An article published this month in Psychological Science shows a substantial relationship between the IQ of the top 5% of a country's IQ scores (their 'cognitive elites') and national income. There is a very strong IQ wealth relationship. For every additional IQ point in that group, a country’s per capita GDP was $468 higher. The article is "Cognitive Capitalism: The Effect of Cognitive Ability on Wealth, as Mediated Through Scientific Achievement and Economic Freedom" and it is reviewed at: http://www.iqmindware.com/i3/highest-iq/iq-wealth-iq-income/

IQ is not related to meritocracy, but to beliefs about meritocracy.

Okay, this post makes me angry.  While there may be a correlation between IQ and income, that does not mean that there is any level of meritocracy in the distribution of income.  Even if we somehow believed that "intelligence" is equal to "merit" (which I definitely will argue against), there are some really good reasons to challenge the idea that the IQ test measures intelligences (and quantifies, no less... as if that were possible). For starters, IQ is based in the ideology of biological determinism and, also, it's a RACIST test, for goodness sake!

Challenge your racist, poor-bashing, and biologically essentialist ideas. Do some reading: http://www.isreview.org/issues/57/gasper-genes.shtml

I recall hearing at one point that there is not a "causal correlation" between high school completion and income. The true correlation is between I.Q. and income. In other words, high school dropouts with an I.Q. of 120 earned as much money 10 years later as high school graduates (no further education beyond that) with an I.Q, of 120. The reason high school dropouts earned less was because, as a group, they had lower I.Q.s--not that they hadn't completed high school.  Having HEARD this, I have never found a reliable, valid SOURCE for such a claim, although it does sound reasonable. Any thoughts or studies to  cite?

Without an age and education distribution of these charts the data is meaningless.

Young people with an IQ of 130 and a living parent and only middle class or poor grandparents are highly likely to have no wealth in spite of their IQ, but when they are 40 most of them will have relatively high income, depending on their chosen profession. When their parents die they are likely to have increased wealth as well.

People with very well off parents who are dead will likely be relatively wealthy and many of them will have reasonable incomes based on the wealth they hold, but those with low IQ's will have had low wealth and low income (unless employed in family businesses) when young.

It's just not simple enough to get the whole story from these two charts.

By themselves without info about age and education and 2 generations of family wealth they are virtually meaningless and probably misleading.

Some of the apparent difference between wealth distribution and income distribution in the graphs flows from using the same dollar scales for both.  Income ranges are narrower, so that graph bunches tighter than wealth which has a broader range.

An income of more than $150,000 is pretty exceptional (probably more than 95% of people will never have that much income in any year of their entire life after adjusting for inflation); almost all homeowners (about 60% of people, at least, become homeowners and stay that way to an advance age) eventually have a net worth of more than $150,000 late in life, so the high end of the scale which is displayed for income is truncated from the data for wealth. Retirement savings for the middle class are also highly age related both due to contributions and investment earnings.

Also wealth, even inherited wealth (which tends to be inherited in middle age or later) -- tends to be strongly age related which is a confound for IQ/wealth relationships. 

This is even more true because an important kind of wealth inherited or accumulated early in life (investments made in one's own education) doesn't appear on a balance sheet - it only appears in income as a derivative result of investments made in someone's income. Further, many people with inherited wealth don't hold it directly - it is in trusts for the benefit of their families and often not reported as part of their own net worth until the trusts are fully distributed late in life, if ever.

Children of the wealthy look self-made on a balance sheet for most of their adult working lives.

Just don't go after the police, and have a soviet flag if you are a smarty, you'll be branded insane and your family will be stolen

Make the best out of your box of junk

I might be wrong on this but it seems that the wealth graph, while it is indeed all over the map, does show a correlation. You can definitely see a cluster around 0 for people with IQs less than 100 which almost completely disappears for people with IQs greater than 100.

Maybe you could actually do a regression and give confidence intervals? Your analysis is lacking. Just because we see a slight positive correlation from the graph doesn't mean that dude with a 80 IQ making 500,000 isn't incredibly influential to the regression. Please give up the data and the source.

I think you are failing to realize what the data shows: that cognitive ability is generally necessary but by no means sufficient to earn higher income or accumulate wealth. For example, a PhD in phylosophy requires a lot in terms of intellect and hard work, but I've never heard of any phylosophy companies hiring.

Wealth is not income x time + heritage.
It's (income - spending=savings)x time+ heritage.
The difference between the graphs could be explained by assuming that people with high IQ spend a higher share of their income than people with lower IQ.

The variable "time" in the formula seems negligible but:
People with higher IQ more often strive for higher education and are therefore often don't start earning money until they are 23 or even older for PhDs, while people without college or even without highschool degree tend to start working as soon as they leave school.

The costs for college are contained in the formula as "spending", which makes the assumption "higher IQ correlates with higher spending" more plausible.

there are all kinds of exceptions i t hink thers more to iq for income you need to have motivation the will to succeed everyone knows that you can be a complete borderline retard with an iq like paris hilton and have millions of dollars because you never used your brain to earn it so this is quite complex alot of wealth has to do with your connections and who you know as well

That isn't really true, CEO children generally grow up to go to their parents alma maters, and the crony system has each other's sons start at high or mid-level jobs with in each other's corporations- I've witnessed this first hand.

Secondly. Nowadays, there is not much opportunity to gain an education unless you have a high income family behind you .most scholarships are skimpy and college fees so high, they are difficult to use.

Thirdly, Unless you are a CEO, or board that can vote yourself high wages, or the very top one percent of any profession except technology and money management- now you will be underpaid. 77% of College instructors, PhD or not, are un-tenured and paid very little. this is also true of anyone involved in the arts, teaching, fabrication, and almost everyone else. Oh , And the government, workers are well paid, well-benefited and well-pensioned.

Since Alan Greenspan announced that keeping workers underpaid, overworked and uncertain about keeping their jobs was the best way to maximize productivity....

Lastly, now there is no way to save- no interest is paid on money you do manage to scrape together as interest gobbles it up at the same time.
So chance to improve one status diminishes over time.

Also, look at the upper halves of both income and IQ. The trend disappears. I think that this is only telling us that there are not a lot of mentally handicapped engineers, but other than that it's a crapshoot.

Of course the rich would rather have intelligent slaves..we are more productive all else being equal. Unfortunately, we are also more of a threat to their status and most of us aren't allowed compensation that enables us to overcome the established rich with inferior intellects and talents.

Hence trump is now our President in America

It's not all over the map. I see substantial clustering there. Do you need glasses? What happens if you run a trend line through the data?

Your definitions for income and wealth are false, Lisa.

1. Wealth is property (right of ownership) at the moment of trade in purchases and sales.
2. Income is sales through time from purchases and sales of wealth (e.g., a car becomes wealth when sold for credit; work becomes wealth when sold for wages)
3. Money does not exist. Money, were it to exist, would be coined mental by weight and fineness. Money, were it to exist, could exist absent bankers or government agents. Cash is bank credit circulating in perpetuity. Checking account credits, of course, are bank credits.

Good luck!

My professionally tested IQ is off that chart, (around 150 or 99.9th percentile.) My income is not off that chart. :(

I was given an IQ test in the mid 1990s by the University of Washington departments of psychology and genetics. They were tracing a bad spelling gene.
I tested top 0.1% in applied math. There were no questions higher than softball freshman calculus. One of the questions had no right answer, so I figured out what mistake the test writer must have made. I am not top 0.1% applied math. Bad test. There is a huge difference in a top verbal person and a top math person. Single IQ number... bad indicator. I am top 2% income, due to saving and investing...not from being smarter. Try plotting % saved and invested vs % income. It is the ant and the grasshopper.

1. IQ is strongly heritable. About 60% of ones IQ is determined by parents (Science Mag, sequence of human genome)) Feb, 2001).
IQ matters both professionally and economically. See the study by Lubinski etal on the individuals who scored in the top 1 in 10,000 on SAT at age 13.
Ashkenazi Jews, on average, score about one standard deviation above the mean in IQ (about 115). Representing less than 1% of the world population, they have received about a quarter of the world Nobel prizes. IQ matters in almost all aspects of life. See the reference by Lubinski et al about accomplishments of those scoring in the top one in ten thousand.

https://my.vanderbilt.edu/smpy/files/2013/02/Top1in100001.pdf

https://my.vanderbilt.edu/smpy/files/2013/02/Top1in100001.pdf

"This suggests that there is some meritocracy in the distribution of income, not so much in who owns yachts and has deep investment portfolios."

This is ridiculous. You're suggesting that IQ=merit, which, of course, it doesn't.

I would love to see a chart with all the most highly correlated data points for wealth accumulation. These would be race, education level, education level of parents, income of parents, income, marital status, ever divorced, religious affiliation, religious observance, etc., etc.

I think it would have been very useful if the article provided something a bit more concrete. For example, what I want to know is "If I'm 10% smarter than you, in general I would make X% more than you." Is X=10 or something else?

That's the real question behind the IQ vs income/wealth, isn't it?

First off, the graphs should represent IQ vs Income and state the variables it used to determine it such as surveying only people between ages 18 to 50 that have verifiable IQ's and verifiable income. The second graph should state the same but exclude inherited wealth. Thirdly, intelligence is inherited. Just look around you at the natural world. We have horses that weigh over 2k lbs called draft horses and yes sometimes they produce smaller offspring but they also consistently produce massive horses so there is some variability but you can't deny that intelligence is a function of the white matter and neural connections in your brain just like being 6 foot 8 playing basket ball can't be replicated by a 5 foot 10 guy with all the talent in the world. I have noticed that many of my friends that are super smart have engineers and doctors in their family tree and any one can argue that 2 doctors can have a dumb kid because it happens but it's the frequency that we should be discussing.