David speaks with Garett Jones, an Associate Professor of Economics at George Mason University, and the author of 3 books: Hive Mind, 10% Less Democracy, and The Culture Transplant.
They talked about:
📉 Good economic policies that people still hate
👥 The power balance between the public and the elites, and why we secretly love them
❓ Where do we go wrong in trusting the masses
🏛️ What Garrett learned working in Congress
🧠 Then we talked about intelligence - the balance between intelligence and behaviour
🌍 The interplay between intelligence and culture
📊 How understanding IQ scores can help us build better societies
🎙 Listen in your favourite podcast player
🎧 Listen on Spotify:
📹 Watch on Youtube:
👤 Connect with Garett:
Twitter: @GarettJones | https://twitter.com/GarettJones
Books: Hive Mind | https://amzn.to/3lgMOdV
10% Less Democracy | https://amzn.to/3Lpbcol
The Culture Transplant | https://amzn.to/3LsttAU
📄 Show notes:
00:00 | Intro
03:03 | Good economic policies that people still hate
06:22 | The power balance between the public and the elites, and why we secretly love them
08:27 | Where do we go wrong in trusting the masses
13:18 | What Garrett learned working in Congress
16:51 | Then we talked about intelligence - the balance between intelligence and behaviour
21:43 | The interplay between intelligence and culture
29:03 | How understanding IQ scores can help us build better societies
🗣 Mentioned in the show:
Adam Smith | https://en.wikipedia.org/wiki/Adam_Smith
Joel Schneider | https://irp.nih.gov/pi/joel-schneider
MAGA Republicans | https://en.wikipedia.org/wiki/Make_America_Great_Again
Patriot Act | https://en.wikipedia.org/wiki/Patriot_Act
Tyler Cowan | https://en.wikipedia.org/wiki/Tyler_Cowen
Axl Rod | https://en.wikipedia.org/wiki/David_Axelrod_(political_consultant)
Steve Jobs | https://en.wikipedia.org/wiki/Steve_Jobs
Elon Musk | https://en.wikipedia.org/wiki/Elon_Musk
Bill Gates | https://en.wikipedia.org/wiki/Bill_Gates
Alberto Alesina | https://en.wikipedia.org/wiki/Alberto_Alesina
David Epstein | https://en.wikipedia.org/wiki/David_Epstein_(journalist)
Charles Mann | https://en.wikipedia.org/wiki/Charles_Mann_(American_football)
Malcolm Gladwell | https://en.wikipedia.org/wiki/Malcolm_Gladwell
Nathan Nun | https://en.wikipedia.org/wiki/Nathan_Nunn
Balaji Srinivasan | https://en.wikipedia.org/wiki/Balaji_Srinivasan
👨🏾💻 About David Elikwu:
David Elikwu FRSA is a serial entrepreneur, strategist, and writer. David is the founder of The Knowledge, a platform helping people think deeper and work smarter.
🐣 Twitter: @Delikwu / @itstheknowledge
🌐 Website: https://www.davidelikwu.com
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🎙️ Podcast: http://plnk.to/theknowledge
📖 Free Book: https://pro.theknowledge.io/frames
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📜Full transcript:
[00:00:00] Garett Jones: Intelligence is not virtue at all, right. One of the usual findings in psychological research is that intelligence correlates very little with personality overall.
But the most of what makes great employees great is not their IQ.
you really wanna figure out whether the person is a great fit for your job and look for signs of creativity, innovation, whatever unique set of skills are gonna make that worker awesome in your job is going to matter more than what their individual IQ score is.
This week I'm sharing part of my conversation with Garrett Jones, an Associate Professor of Economics at George Mason University and the author of three books.
Now, this was an incredibly wide ranging conversation that I thoroughly enjoyed. In this episode, you're going to hear us talking about the economics of disagreement, the power balance between the public and the elites, and why as much as we profess to despise them, we secretly love them and rely on having elites.
And then we talked about where we can often go wrong in trusting the masses and what Garrett learned from working in Congress.
And then we started talking about intelligence and IQ and the balance between intelligence and behavior as well as the interplay between intelligence and culture.
So this is definitely a really engaging conversation. You can get the full show notes transcript and read my newsletter at thenowledge.io and you can find Garrett on Twitter @garrettjones.
Now, if you love this episode, please do share it with a friend and don't forget to leave a review wherever you listen to podcasts because it helps us tremendously to find other listeners just like you.
[00:01:37] David Elikwu: One of the first questions I wanted to ask is if you could explain the narrative arc through your three books you've written this Singapore trilogy, as you call it, but how would you describe the narrative arc? Cause they seem to interconnect in some different ways between all three of them.
[00:01:52] Garett Jones: Well, yes. So all three books in the Singapore trilogy are really my attempt to sort of get at the wealth of nations, you know, at the old Adam Smith question, right? Let's make an inquiry into the nature and causes of the wealth of nations. And, you know, my fellow Macroeconomists, we've enjoyed these big picture approaches. That's sort of our take is like, how can we find a ridiculously simple story that can explain maybe half of everything and then leave the details to somebody else.
So the first book was really inspired by my talking with psychologists, especially my childhood friend Joel Schneider, who's now a, a psychologist psychometrician.
And we talked about research that found that cross-country test scores predicted the wealth of nations really well and standardized test scores. He and I together worked out some statistical work and we found out that statistically these standardized test scores are much better predictors of national prosperity than just about anything else out there. Since then, other people have reinforced this research including some new work by the World Bank.
And so that just got me thinking that basically other fields have something to add to economics and economists have something to add to other fields. So together, us working together, we said something new.
And so that was the first book in what became the Singapore Trilogy Hive Mind, how your nation's IQ matters so much more than your own.
The second book was really thinking about, how we economists, we monetary economists in particular, we take for granted that like central banks are super awesome and that having them separate from the voters is actually good. And we don't spend a lot of time thinking about the fact that that's pretty undemocratic. But when you look around at modern governance, a lot of the things we like best about modern governance are things that aren't all that democratic. Like independent judges, independent central banks, long terms for politicians.
So that was my book that was really about economics meets political science.
And then the third book, my most recent one, Culture Transplant is really about finding out about culture, really studying things that normally anthropologists discuss. So, trying to figure out how migrants bring their cultures from one place to another.
So each book, the reason Singapore matters to each of them is because Singapore is a country with exceptionally high test scores. Singapore is a country that has very limited democracy, to put it politely. And Singapore is also a country that's heavily shaped by Chinese migrants who brought the culture of Ming Dynasty China, and made a great success of it in Southeast Asia.
The narrative arc is really one book is economics meets psychology, the second book is economics meets political science, and the third is economics meets anthropology.
[00:04:30] David Elikwu: Okay, Awesome. I wanna ask a quick question about the central banks, just because you brought it up and I wanna start there just because I probably have less questions to ask specifically on that. But it s one that just immediately came to mind.
Loads of people, the regular people, and this is something you touch on in your book, the masses complain about central banking and a lot of people can feel like central banks make mistakes and they make decisions that go against the best interests of a lot of people.
So how do you marry, I guess the economic perspective of something that you think is a good thing overall with something that for a lot of ordinary people within the masses, they disagree with?
[00:05:07] Garett Jones: Well, this is the case where at the average person just thinks money matters way more than it does. I mean, obviously in on some level, the amount of money you have in your pocket affects how much you can buy, right? But when economists do big cross country comparisons and we check and see, well, when countries have hyper inflations or super low inflations or something in between, does basically the rate of inflation or the rate of money printing really appear to have that much of a causal effect on how rich you are, in your country. And the answer is no, basically bad monetary policy, high erratic levels of inflation are more of a symptom of a lot of other bad things going on than they are a bad thing by themselves. And so that's a big mega picture of this.
But at the micro level, I mean obviously there's political manipulation of banking in corrupt countries, right? Some people can get loans if they're connected. Some people don't get loans if they're not politically connected, that's obviously important. The solution to that problem is to have a more technocratic central bank, one that's more independent of political cronyism and led by basically, people who are nerdy folks like me, who are very socially awkward and, we don't have enough social skills to be politically connected, my fellow Macroeconomists, that's a little glib, right? But it's the idea that you want politics out of banking as much as you can and at the same time recognizing that the reason some countries are rich and other countries are poor, central banking is very low on the list of what matters there. Great central banking is nice to have, it's a plus factor, but it's not a major driver for the wealth of nations. Monetary economics, totally overrated as a cause of national prosperity.
[00:06:46] David Elikwu: I really wanna dig down on this idea that, like I said, for most people, they seem to be at odds with a lot of, not just economics, but also politics in terms of what the elites or the people in charge might believe compared to what the man on the street believes.
And I guess there's a sequence of postulations, I guess, from your book, which would be not just from your book, but Okay. So you start from the position that, the man on the street doesn't necessarily understand the invisible hand of economics, they don't necessarily know everything that is going on. Then you have the complex interaction of democracy, which we have, which in some ways is a great thing and seems to be better than a lot of other systems. But democracy says that we have to give control and at least a voice or some kind of power to the masses and to the people. And they get to vote, they get to have their say. But then you get to the kind of final point where very often what people think is best for themselves is not actually what's best for them. And sometimes you need leaders that can make decisions on behalf of the people that seem to be contrary to what they think is best for themselves. But then I guess squaring the circle, you can end up in a place where when the authority is doing what it thinks is best for you,
you know, there's an invisible line between that and jumping straight to autocracy
[00:08:02] Garett Jones: Absolutely, yeah. And you know what that, those are terrible, right. So, there are two great things about democracy that are pretty unambiguously true. One is, democracies essentially never have famines and democracies rarely kill their own citizens to a large degree, right? So those are two great things about democracy, and if anybody wants to make any argument for autocracy or monarchy or whatever it is, they have to fight against those two facts, right? And they're pretty both well nailed down by economists in quantitative studies.
But beyond that, what we call democracy today is basically the voters checking in on a largely independent government every couple of years, right? So, the United States is pretty rare in having a whole house of government, which is actually two blocks that way from me of the House of Representatives. And there they have two year terms, right? And almost nobody in the world makes that mistake of having political terms that are that short. We know that on average it seems like you need to give a little bit more distance from the voters to get many good things done in politics. And that's not a cure all, but it's a symbol of the fact that having voters too close to the political system is probably bad on average.
So that's one sign, like when we look around, like people who say we need more democracy rarely think, Hey, the masses should be voting on each and every government decision, and they certainly don't think that people should be voting on interest rates. So there's a little bit of a confused discourse when people say they want more democracy.
So a little bit of autonomy, a little bit of distance seems to make politicians be a little bit more long farsighted. This is something that the American founders thought about when they wrote about why they wanted the US Senate to have these long six year terms. They said, you know, sometimes you're gonna vote for something in your first year in office and you kind of know it's gonna take three or four years to be really obviously good from the voter's point of view, so a longer term helps with that. And that's pretty undemocratic saying you gotta wait six years to check in on the government and fire the people.
So the second point that you make about, the invisible hand is really well taken, right? Being against competition and the market is pretty intuitive on a lot of dimensions. As consumers we're, it's obvious, like I wanna have a lot of goods to choose from. But when you're a supplier of a good, especially when you're the supplier of your own labor, the first thing you think is the boss shouldn't be able to fire me. There ought to be a law against that. Like, unless I'm a total drunk or unless I start beating people up at work, right? Unless it's really bad, it's just common sense that I should have strong worker protections. And economists, you know, we check this stuff out statistically, we check it out by using intuitive models and all around it looks like, on average you wanna let bosses, fire workers for kind of the reason you wanna let people get outta marriages. So, marital security has its benefits and its costs, job security has its benefits and its costs. And overall around the world, it seems that we get our best matches both in the dating world and in the job world when we allow people to end their relationships.
So that's one version of the invisible hand that I think, takes a couple of steps of reasoning to walk through. But you can understand why for centuries, for millennia, people oppose divorce. Cause you know, what are people gonna do if you get divorced? Similarly, there's been a much a similar battle over whether, we should stick with the common sense idea that nobody should be fired or unless they make egregious errors, and instead we kind of understand that you're not gonna get high dynamism, high productivity businesses unless you can let workers go now and then.
[00:11:27] David Elikwu: One thing I'm interested in is the title of your second book, The 10% Democracy. Why Should Oh, yes. Fantastic. So why you should trust the masses lessen and the elites more.
What I'm interested in, okay, maybe, first of all you could give a definition of what you mean by elites, because I guess the second part that I'm quite interested in is, maybe for a lot of people when they think of elites, they think of a different kind of invisible hand. They think of people making things happen behind the scenes and the people that have all the control. But realistically, even when we look at politics, half the time, it doesn't look like a lot of these people are agree anyway. And even within their own parties, I'm thinking of America for example within the Democrats and the Republicans, there's almost two halves on both sides, right? You have like the super liberal or radical progressives, and then you have the rest of the Democrats. And then on the Republican side you have maybe, what Biden called the MAGA Republicans and then the rest of the Republicans. So it doesn't always seem like the elites themselves agree.
So maybe how would you define elites and how do you marry that dissonance? Where for the regular person, it doesn't even seem like these people have it together for themselves. So why should we trust them?
[00:12:36] Garett Jones: Well, I intentionally picked the word elites rather than just saying, you know, going with the more Aristotelian approach of talking about the best, the aristocracy, right. So the elites are basically just whoever happens to be on the top of your society at the moment, right? They may be educational elites, legal elites, politically connected folks, inherited wealth, some mix of that, right? And I wanted to argue that not that these people are perfect, they might be terrible, but since I'm an economist, my goal isn't to compare things to utopia. My goal is to compare things to the alternative and the alternatives are ruled by the elites, is ruled by the masses. And have you talked to the masses lately?
This is sort of the story, right? So as an economist, I'm trying to compare things to non utopian alternatives. We often get accused of making unrealistic assumptions in our models, in our theoretical models in economics, but my gosh, listen to somebody sing the joys of democracy. And that's a form of utopian as a beyond anything I could handle, right? So, when I'm looking at the elites, like there's some cases where I think it's pretty obvious that like, the elites are way better than the masses, and that'll be the case in say, central banking or like most judicial decision making or firefighting. You just don't want the average person deciding whether you put out how to fight a fire, right? You just wanna leave that to the experts.
But beyond that, my goal was to say look, these clowns over here on Capitol Hill, which is just my right here.
You're actually better off having them in charge of a lot of this stuff. Because when you give them six years for a term, they care about the long run in a way that a lot of voters don't have to think about it. And so, even that mediocre version of our elite, the politically elected elite, who's sometimes cares about campaign donors, sometimes cares about the voters, sometimes cares about who's gonna hire them after they leave Congress. Then with all their flaws is still better than running things by a national plebiscite.
So that's kind of like I wanna point out, so I'm here to point out like some elites you already kind of know are good and you just don't wanna say it. But the other elites who are mediocre, we've created rules to get them to focus on the long run, in a way that's way better than leaving it to just to the voters.
[00:14:42] David Elikwu: Okay. And you mentioned that Capitol Hill was just to your right there or to my left in the mirror image. So going back to the, the popular conception maybe from the layman, that economics is has a lot of stuff that works in theory and is different in practice.
An interesting question from my view is, I know that you worked in Congress in the nineties. I'm interested to know, was there anything that surprised you or was there anything that you thought would work one way in theory and was different in practice?
[00:15:08] Garett Jones: Well, it's that, it's hard to get good ideas moving in Washington because everything in politics, well, 9 times outta 10, most of politics is about coalition building, right? And you're rarely even in the Senate when there's only a hundred senators, even in the Senate, it's hard for any one senator to be pivotal enough to build that coalition.
So much of politics is a bunch of people throw their good or bad ideas into the bin, it all gets kicked around in Congress. And then when either the president or the Senate majority leader decides it's time to put together a bill, that's when they start grabbing all the ideas that are in the idea bin and trying to figure out what's gonna work politically.
So much of Capitol Hill life is about marketing, right? People set up late at night coming up with clever acronyms for their legislation. They coming up with clever bullet points for how they're gonna sell it on the evening news.
My boss, but just before I got there, somebody on his team actually has the credit for coming up with the acronym for the Patriot Act, the bill that basically, you know, restricted a lot of civil liberties in order to make it easier to fight terrorism. But they took great pride in the fact that they came up with an acronym that worked and it stuck and it's lasted for decades. So political marketing turns out to be really central and that's not just about selling things to the masses, it's about selling things to the other 99 senators. That's something that I think outsiders don't appreciate as much.
[00:16:34] David Elikwu: Sure that makes sense. But even what you were just saying, and it might seem like I'm going back a bit to something we just talked about, I think they're connected. The principal agent problem where it seems like the incentives for the people that are in these positions don't always align with the positions that they are supposed to be representing. They have a very different set of, you know, they have their own personal agenda for propagating themselves and their careers. They also have the incentives of their network and their worldview, which again, might be misaligned with other people's. As you mentioned, there's a lot of focus on, maybe you get to create some acronyms, you get to put your name in the history books in some respects. Or even just being able to get things done. Cause I think that's another hard thing where sometimes you end up in a position like a few years ago, the government shut down because again, you can't get both sides of the aisle on the same page.
[00:17:21] Garett Jones: Yeah, you're right. Principal agent problems are everywhere in politics.
In politics, in electoral politics, in democratic politics, the principle is, are the voters back home, right? And so the principle, those voters back home do a sort of lazy job of monitoring the agent, the politician they send up there.
And one of the pieces of magic about the Senate is that it's clear that politicians act like the voters back home only remember what happened in the last two years of the six year term. So the term they use on Capitol Hill for this is a senator being in cycle, a senator's in cycle when he is two years away from your election, and that's what he's really expected to basically cave into the voters and panders of them. Or in other words, they're supposed to act like they're democratically elected officials. So that's when in a way the principle agent problem is solved. But by the standards of economics, that's when politicians often make the worst decisions. So it turns out that economists, it turns out that senators are less likely to vote for free trade bills, for instance when they're coming up for reelection. They're more likely to vote for free trade bills when they're further from re-election. And if there's one idea that economists pretty much agree on, it's that free trade bills, lowering tariffs and all that is pretty much a pie grower all around that tends to grow the pie for the whole country.
And so sometimes that solving that principle agent problem is actually bad for what giving the voters what they want. If the voters want prosperity and they want the politician to vote against free trade bills, then they want contradictory things, right? So we want politicians, like I personally want politicians to do things that help human flourishing broadly construed. And sometimes that means picking one thing the voters want over another thing that voters want. So I'm glad that sometimes politicians have found a way to blow off the voters and to increase the principle agent problem.
When we talk about standing up to the mob or profiles and courage, those are all phrases that we use to talk about making the principle agent problem bigger, where the person basically disobeys their boss, right?
So, and sometimes that's a good thing, and we call that political bravery and that's undemocratic. But we should be comfortable with that tension that sometimes doing the right thing for the people means doing what the people don't want.
[00:20:17] David Elikwu: Fair. Okay. In Hive mind, one of your other books, you make the correlation between cognitive ability and economic growth. I mean, maybe taking a step back from that, I'm interested to know what got you interested in this relationship in general and maybe going back through your career in general. Like what was the set of steps that led you to, to getting to where you are now?
[00:20:38] Garett Jones: Well, I, I tried a lot of other social sciences before I landed in economics. Basically, I was too chicken to take all the math classes that I would need to go get an economics PhD. So first off, I tried out a political science PhD at UC Berkeley, and it was clear that wasn't gonna go anywhere. I took a master's degree, took a year off, and took a bunch of math classes and decided like, you know, economists, they have these thin models, these simple reductionistic models, but they're simple reductionistic models can take me further than I think the more verbal style of reasoning that goes on in the other social sciences.
So that big break that I needed to kind of pause my intellectual career, take the math and embrace some reductionism, some oversimplification for a while. I think that turned out to be a really positive part of my intellectual journey. And when I was in grad school, economists were taking more interest in trying to explain why some countries were richer than others. Cause it was getting easier to collect all this cross country data, not just from 10 or 20 or 30 rich countries, but from middle income and lower poorer countries. And the data was getting more reliable by the year. So I sort of watched that data building up, but in the back of my head, what I thought was, I don't really need to do research into why some nations are richer than others because more or less, Adam Smith was right when he said that, all you need for a nation to go from port to rich is peace, easy taxes, and a tolerable administration of justice.
And at least two of the three of those are totally outside the purview of economics, at least peace and a tolerable administration of justice, right. And I thought most of the wealth of nation stuff is gonna be some other field's job. Like we economists aren't gonna be very good at that. So that's part of the reason I held off on it at the beginning.
But later on as I spent my time in the Senate and as like a lot of economists in that era, I got more bored by monetary economics cause we were just kind of convinced it didn't matter that much. And we seemed like we had solved a lot of problems. It seemed like, I decided to go back in. I want to explain why some countries are richer than others. I wanna see what's going on with this line of research.
And around that time is when Joel Schneider, the psychologist, got in touch with me and told me about this data set of cross country IQ scores that were very, they were flawed and imperfect and we always talked about that in our research, but they correlated really well with a smaller set of international math, science and literacy scores that other researchers had come up with. And so I thought, you know, a whole lot of data in economics is flawed and imperfect, and let's see if we can do some research with this flawed and imperfect data. And that got us thinking about how generalized mental skills, standardized as measured by standardized tests seemed to capture something that really was important for modern prosperity.
Basically, running a modern economy means solving a lot of little puzzles. So a lot of the things that we find difficult in IQ tests are actually something that shows up in running a small business, in coming to political bargains, in solving an engineering problem when you're trying to fix a bridge and you're not quite sure what's wrong with it, you know, as one psychologist says, intelligence is what you need when you don't know what you need. It helps a little bit everywhere.
And I saw a lot of little signs in economic research that suggested that, that general mental set of skills was gonna pay off a lot. And that got me going down that path of realizing that there was a payoff here. And the, finding that I'm most excited to buy, which has been replicated by other people since then is that, smarter groups on average are more cooperative. Simple crude imperfect IQ tests are good predictors of group cooperation. So smarter individuals are not more cooperative, they're actually more Machiavelli in it, if anything, in experimental settings. But when you put teams of smarter people together as measured by IQ tests, they seem to cooperate more and grow the pie rather than sort of try to stab each other in the back in order to grab a bigger slice of the pie.
I think that's a pretty important finding cause the foundations of trust of cooperation of trying to grow the pie rather than fighting over the size of the slices. That's a big part of explaining where prosperity has come from over the centuries, and I'm glad I can make a small contribution to that.
[00:24:48] David Elikwu: Okay. That makes a lot of sense. And that's a really interesting finding, and I know that you've come across some other ones that you talk about in Hive Mind, for example. I'm thinking of, there's quite a few things. First of all, just the drastic difference in the impact when you look at the top 10 countries and the bottom 10 countries economically and how that correlates with IQ score.
But then also I think you also talk about, I think it's almost a difference to the power of six of the difference between, let's say an individual's correlation with their salary or their wages and then on a larger scale the country's correlation.
[00:25:22] Garett Jones: So basically the short version of that is that my early finding was that IQ mattered six times more for countries than it does for you as an individual. So an individual person's IQ is an okay predictor of your lifetime, of your average lifetime wages. It's not terrible, it's maybe better than any other single thing you could find. Education may be better years of education. But at the same time, we're talking about going from like IQ at the 10th percentile to the 90th percentile, predicting maybe, oh, 50% hike and wages, 70% hike and wages. I mean, that's nice, that's good. But if you went across countries with a test score gap that big, you'd be talking about countries being 8 or 10 times richer, not 80% richer, right? The difference between 80% versus 800 or 900%, that's a huge difference, right.
My colleague Tyler Cowan, wrote a book called Talent about High, higher good Individuals. And what he says in there about IQ is that, IQ is underrated from the point of view of what the average American thinks, but it's overrated from the point of view of what the average top executive thinks. So normal people might think like, well, these IQ scores are all messed up and they're kind of worthless. But people who are top executives are like, I want the smartest person. But the most of what makes great employees great is not their IQ. If you're hiring one person at a time, at a firm, like, sure, it's nice to know whether the person went to a good school and what their SAT score is. But you're, you really wanna figure out whether the person is a great fit for your job and look for signs of creativity, innovation, whatever unique set of skills are gonna make that worker awesome in your job is going to matter more than what their individual IQ score is.
[00:27:01] David Elikwu: There's another correlation which you mentioned earlier this idea of maybe some individuals with a higher IQ being a bit more machivillian for example. And I think that is, is one of the things, just like you said, where okay, for an individual person, the IQ isn't the only thing that counts, particularly when you're thinking of hiring an employee.
But what I'm interested in knowing from your perspective is, and it's not just limited to IQ, but people often conflate intelligence and I guess behavior. And so you see some examples, I was just seeing some people having a conversation the other day on Twitter, for example, of like Steve Jobs or even Elon Musk in some respects now. And you see quite some other people also who exhibit traits of exceedingly high intelligence and also just high competency and high proficiency in all manner of things like these are clearly smart, incredible, brilliant people. But they might also exhibit some traits that are not the best for cohesive work environments or just kindness or empathy or some other things in general. And I think one thing that a mistake people can make is conflating the two and associating both of those things together.
[00:28:09] Garett Jones: Yeah. Intelligence is not virtue at all, right. One of the usual findings in psychological research is that intelligence correlates very little with personality overall. The one it does correlate with a little bit is, so your IQ score correlates a bit with your openness, like your willingness to try new things, your risk taking, but it doesn't correlate at all with being conscientious. And if you think about what makes somebody like a Steve Jobs or an Elon Musk person exceptional, part of it, just part of it is that combination of high IQ plus being willing to put in like 80 to 120 hours a week, on a job when it's necessary. And a lot of smart people just aren't willing to do that.
So you're getting somebody who's basically gotten really great draws, they've pulled two winning lottery tickets. They won the IQ lottery and then they won the conscientiousness lottery. Now it turns out that a lot of them may also be kind of high on the traits that people consider Machiavellian, right? Versions of high neuroticism, sometimes. It's not really clear whether, like, usually being neurotic, being very volatile in your emotions is kind of bad. It's possible that it's a kind of game theoretical trick people can use to extract more wealth from other people. Like I can, I can start yelling at you erratically as a form of punishment, and that might draw some more work out of you. And it's possible that there could be some evil forms of Machiavellian and personality dynamics going on in highly productive teams, right? There's a bit of mystery to what makes productive teams so productive. I wish I could tell you that it's all about like happy, happy joy, joy where nice traits and kindness and generosity and living the golden rule are the only things that work.
But one of the things you learn from normal game theory is that, being willing to drop the hammer on someone, being willing to show that you won't get ripped off is part of the magic of this, part of the magic of what makes team cooperation work.
In the excellent book by Axl Rod, the Evolution of Cooperation, he talks about how basically the way to get cooperation in groups is to start nice, but then don't be a pushover. Be willing to drop the hammer and punish when someone betrays you too often. And so there's an element of what in other settings we call good cop or bad cop. And there's another element of having the velvet glove, the iron fist with a velvet glove over it, right. Start nice, but then be willing to speak softly, carry a big stick. These are all beams that we have out there, that there's some element of meanness that may be functional for teams. And I mean, I suspect that people don't like to say this out loud, but that Steve Jobs yelling at people, is that part of what made Apple work well? Am I sure that it was not part of what made Apple work well? I don't know. I know that game theory can tell me that sometimes yelling at people can get you good stuff.
[00:30:50] David Elikwu: Yeah, I think that's the balance people find hard to strike. But I think maybe my intuitive response to that might just be, very often I see people thinking that same way and trying to intentionally replicate those aspects of what they see in Steve Jobs, what they see in Elon Musk, et cetera, et cetera.
But the issue is, and you can extrapolate this also to people making other types of decisions like, oh, Bill Gates dropped out of college, I should drop out of college. You know, any plan that involves you being Elon Musk is probably not the best plan to have, right. And whatever all the other stuff that made Steve Jobs, who he was and as great as he was you probably couldn't emulate simply just by being disagreeable or just by, you know, just emulating one, one random aspect of his character.
[00:31:34] Garett Jones: Yeah, and some part of that, for instance, the disagreeableness. The disagreeableness probably functions better at the higher level you are rather than the lower level. At the lower level, you need to work with people, right? You need to pull people in. Once you have a big surplus and you wanna make sure the surplus keeps growing, maybe different strategies work, right?
So, you know, I've read just enough about Napoleon to know that he was a lot nicer guy when he started off, So, I mean, that's to put it mildly, right? He knew he had to build coalitions, he had to build teams. And then once he knew he was on top and there were only two people he had to push out in order to become the, the dictator, the emperor, that's when he did it, so he bited his time.
And so starting off mean is probably not the right thing to do because so much of modern, success in modern capitalism really is about cooperation. So getting people to work with you, getting people to entrust you with their money or with their time, that's important. People are skeptical and cautious in giving their money or time to other people, and they want to give it to people who they don't think are gonna betray them and be disagreeable.
[00:32:34] David Elikwu: Yeah. So we're starting to get into this, the crossover between values and IQ, which I think is gonna be really interesting territory, and we're gonna get into some of that in a moment. But one question that I really wanted to ask you was, I know that you grew up in the Mormon church and one of the things you've talked about in your books is also the, I guess first of all where IQ comes from, but then also there's an extent to which environment and where you grew up and how you grew up can influence your IQ.
And so I'm interested to know how you think that upbringing and that balance, maybe not just your, your IQ, but your, the values and how some of that might have influenced your work.
[00:33:10] Garett Jones: Yeah, I definitely think that being raised among the Mormons, being raised as a Mormon, really helped me build social skills and helped me learn to get along with strangers in a way that I wouldn't have otherwise. I mean, I was a sort of nerdy, bookish kid, and Mormonism, every Mormon congregation, it's about 200 people. It's all run by volunteers and everybody takes turns basically taking different positions. And so you learn a little bit about what it means to lead and then in turn to be led. You learn something about how organizations work at a very natural level. From the time you're say, 10 or 11 onward. And so I think Mormons grow up with less naivete about basically the flaws and promise of team activity, right?
And say, you know, people who don't, people who are never in the middle or upper levels of a hierarchy might just think, oh, that hierarchy's all against me. But once you've served in a couple of rungs in it, you realize, man, it's hard to make these things work. I wanna hold a church activity. How do I get 15 people to come to this thing? And if I can't get 15 people to come to my activity, how am I gonna run a website that gets millions of people to come to it? I do think that Mormonism builds a form of social capital that is rare among modern American faiths because of the fact that it's run by volunteers.
I think that's extremely helpful. I'm really glad I got that experience. The fact that Mormons combined this element of sticking within the club for a lot of hours a week. They've cut back on it since then, it's not as many hours now, with going out into the world and being missionaries and living in foreign countries at a young age. I think it does give them a kind of a neat mixture of cultural dynamism plus cultural conservatism that is sort of a secret sauce. I mean, it's no surprise that they're overrepresented in places like the FBI, the CIA, other, you know, intelligence agencies, because they speak a foreign language, they know how to work in organizations and they can usually pass the drug test. And that's a key to success in a lot of big bureaucracies nowadays.
[00:35:02] David Elikwu: Fair. I think what you just touched on also speaks to culture. And I'm interested in maybe there, there's a macro and micro level to this. I know that you talk about the macro level in the culture transplant, but you know, how do you find the dynamics? Maybe let's start within a country of how some of these different cultures interact and how that can influence whether it's IQ or economic development.
Because I think you end up with as, as much as, okay, there's a macro picture where you can say, okay, the average or the mean of all the IQs in this region, here is the distribution, here is how this works, here's how this looks. But obviously within that, we are already in a position in a lot of these nations, the US for example, where it's heavily diversified and you have loads of clumps of different types of cultures, different types of communities that are already preexisting. So we can't even necessarily start from a fresh state and say, oh, okay, how it is here before you have all these immigrants and before you have anyone coming into it with a different culture or a different faith or a different background or set of values.
So I'm interested in, how do you find, I know that there's an extent to which you disagree with the melting pot theory and, and that makes sense, but the existing cultural milieu in the US and how that contributes to its economic development.
[00:36:16] Garett Jones: The United States is this amazing outlier on so many levels, right? So, it's a country with enormous, it's much more, income per person in the US obviously is a lot higher than Western Europe, right? And yet we officially think of the US as a sort of offshoot of Western Europe, right? That's the first order model of the U.S. like, a bunch of Europeans violently invaded North America, made a country, right? And those people ended up being like, even to this day, 30% richer.
So, there's something different about this place, right? That's where I'm, I am right now in the U.S. And the other streams of American, of the American demographic experience, the enslavement of Africans, the diminishment, the slow motion genocide of Native Americans over the course of centuries. These all shaped the American demographic background. And then at some point more, of course more and more Europeans came bringing different cultures. It turns out the easiest to study wave for some purposes, in the last few decades in Econ has been to look at that second wave of European immigration. So it's the, my Irish ancestors, it's Italian Americans, German Americans, those folks moving in, in the mid to late 1800's. Now there's just enough data recorded that people couldn't kind of compare the before and after.
And, you know, I had a college professor in a class say, America's never really been the same since they let the Germans So he thought that, that's, once there was that big wave of German immigration to him, hah that's when the great era of the founding fathers was gone. That was his point of view, not mine, right? Because my my Irish ancestors were part of that second wave.
I mean it, it turns out that wave of immigration has been studied a lot and all of the optimistic stereotypes of immigration turned out to be true, which is that wave of late 1800's, early 1900's immigration seems to be associated with more innovative activity. We'd like to measure patents, right? Economists that we find those easy to measure.
More innovative activity, there's a lot of prosperity and that wave of migration seemed to make America richer, right? Scandinavian Americans moved to the upper Midwest, which was a really inhospitable place, and yet their wages ended up higher than that of the average American in the first and second generations.
So, America, how much of that is that Americans built, a form of a culture that made those folks better? And how much of that is selection that the people who came from Europe and who were willing to voluntarily migrate were actually people with higher human capital, higher conscientiousness? This is hard to tell. This is gonna be a project for the 21st century. Your generation gets to find out the answers to that questions, like maybe by this time next year, chat GPT can just answer that question by pulling up the data automatically.
But, you know, America has had both good and evil experiences with immigration. We can tell that the recently heavily studied waves of immigration, the cliches are true. The first generation definitely adds a lot to the innovative potential of the country. And where my work follows on is looking at the second generation and beyond, asking those kinds of questions that are more closer to what long termist philosophers would care about. First generation, super heavily selected. I'm more curious about what's going on in the second and third generation, cause it hasn't been studied as much.
[00:39:32] David Elikwu: Sure. And one of the things that you found is that culture can be quite sticky in the second to fourth generation. I'm not sure if you've looked much beyond that and, and how
[00:39:42] Garett Jones: hard to measure it beyond that, right? Like Yeah, yeah, I mean, for instance, when we're measuring people who say they're fourth generation, we usually only have one measure, list three places your ancestors came from in a survey and whichever one you list, number one, they count you as that.
So with second generation, we have a lot better data because they often ask people just, where was your mom born? Where was your dad born, right? So that's much more precise data. And so when you're finding that persistence to the second generation, for say whether women stay in the workforce, how many children women have? These are pretty objective measures and we find a lot of stickiness in the second generation, bringing old country attitudes to the new country they move in. And this isn't just about America, it's been heavily studied in Europe as well. Europeans have been interested in this.
So those are two countries where there's a lot of, been a lot of recent immigration the last few decades and second generation attitudes, sometimes sticky, sometimes not, depends on the issue.
[00:40:36] David Elikwu: Sure there's an aspect of it that I am surprised does not play a bigger factor or, or doesn't factor into the statistics as much. And I'm interested to know, I guess your thoughts on that, which is, I would assume that immigrants by and large, maybe by proxy in some ways, Are somewhat different culturally from the rest of the people in the place that they came from, because they're a self-selecting group. They are people that intentionally decide that I am going to go and chase something better or something different. And not everyone thought that, right?
And so what I'm interested in is, what's the halfway point? Because I think there's a point that you make, which resonates a lot with me.
So I came to the UK from Nigeria and for example, actually great example, my younger sister was born here and grew up here. And I can see some differences between how I might think of some things and also maybe my parents and how my sister might think of some things considering that she did all her schooling here and, everything that she knows about the world, I guess is rooted here in some ways, even though she has visited Nigeria.
And I think you can extrapolate that to lots of immigrant stories where, the polls, which is okay, the old world. How did everyone think, where in the place that you came from? You and your family and, and you being a self selector, deciding to make this voyage. How do you think? And then the new place that you're going to.
And I feel like a lot of people are somewhere in the middle where, it is correct that perhaps they may not assimilate fully and you may not, let's say you come from India and you go to America. The day you arrive, you are not necessarily having all of the same liberal values or whatever the American values may be as every other American on the street. However, you probably are more likely actually to enact some of those values as opposed to some of the values from the place that you came. That is what I would've thought.
[00:42:20] Garett Jones: Yeah. So the first generation, actually is more assimilated on some issues than the second generation is, this is something that Europeans have found to a great extent with religion, right? So people who migrate from heavily religious countries to Europe often decide to go to Europe because, Hey, I'm not that religious. I'm tired of being in a place where religion's dominating everybody's life. And then they, they get there, then the second generation, their kids grow up and are often more religious than the parents who came to the new country. So that's just one example that's been heavily studied in Europe.
The very last study that I cite in the end of chapter one, actually has a collection of data for first and second generation. And I won't get the numbers right, right now. But it is often the case that first generation immigrants are more assimilated on key issues than second generation immigrants. You know, if you're the kind of person who cares about what accents people have and how often they speak the language. Yeah, the first generation might not, they might have kind of strong accents sometimes, it's hard to shake that, right? No matter how hard I try, if I move to France, I'm always gonna speak it with a weird accent.
But in terms of values, the self-selection factor that you mentioned is gonna be really important. And it's gonna mean that on a number of issues, people who can choose to move to a country are gonna pick a country on average that they think they can assimilate into pretty easily, right. Or that they want to assimilate it to. So either supply side or demand side reasons. So, and then the second generation, often you see a bit of a, what some people call a backlash effect. But it may just be you know, what statisticians would call mean reversion. You're reverting to the mean of the home country.
[00:43:49] David Elikwu: Okay. The mean reversion point is interesting, but I was just thinking about the backlash and I think, you know, what's the extent to which you think there might just be, I feel like with all cultures there is an always an extent to which very often your kids kind of revert against some of the stuff that you did they're
[00:44:05] Garett Jones: just rebelling against the parents, right? And so the way, the way you can measure that, aone way to measure that is to just see if it's true for many different cultures in many different ways. Suppose people are coming from an irreligious, a very irreligious country to a medium religious country, right? If the parents migrated because they're moderately religious, the idea of the kids rebelling by being super irreligious is a little bit odd. You could also rebel by just going more toward the norm of the new country. So if the parents are basically meeting halfway between, why is it that so often on average, the kids are reverting to a mean in a country that they themselves have never been to. There's more than one way to rebel, you can rebel forward to the country you're living in, or you can rebel backward to the place that your ancestors came from. And on average, people are rebelling backward to the country that their ancestors came from.
And that's a sign of some kind of cultural transmission that's deeper than just simple rebellion against parents.
[00:45:02] David Elikwu: Thank you so much for tuning in. Please do stay tuned for more. Don't forget to rate, review and subscribe. It really helps the podcast and follow me on Twitter feel free to shoot me any thoughts. See you next time.
