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How Many Successful Entrepreneurs Would Fail an IQ Test?

Mr Personality examines the link between IQ and entrepreneurship

Although IQ tests are very unpopular, they have been known to predict important outcomes for decades. For example, children's IQ scores predict not only how well they will do at school and college, but also how long they will live (even after controlling for socio-economic status). Sceptical readers should consult any of the review papers by Ian Deary or Linda Gottfredson.

Psychologists have also been studying the validity of IQ tests as predictors of job performance. Again, there is a clear discrepancy between the scientific research evidence and what laypeople, and even some professional practitioners (HR departments, managers, recruiters, etc.) tend to believe. Thus scientists concluded long time ago that IQ is the most powerful psychological predictor of job performance, whereas laypeople tend to think of IQ as something that is useful only when it comes to predicting how well you do in a maths or general knowledge quiz -- indeed, people with extremely high IQs are almost always portrayed as being geeky, weird and socially inept (an urban legend that has made Goleman, Gardner, and Sternberg rich and famous).

But is the division between the scientific and common sense views of IQ irreversible? If we assess the growing consensus, over the past two or three decades, among the mainstream academic community, about the predictive power and usefulness of IQ tests, and contrast that with the growing scepticism (over the same period - when books such as Emotional Intelligence, Multiple Intelligences, and Successful Intelligences became best-sellers) among laypeople about the uselessness of IQ tests, one would be tempted to think that the answer is "yes". Moreover, while most of the top academic researchers in Industrial and Organizational Psychology continue to endorse the use of IQ tests for personnel selection - even if they have adverse impact against certain groups - practitioners seem more and more convinced that they should use alternative methods for predicting career success (if only to avoid adverse impact).

How, then, can we account for the fact that what some of the most academically knowledgeable psychologists see as Psychology's main contribution to society is seen as a joke, or at least "problematic", by most of the people who should benefit from this well-established scientific tool. In other words, why are people so opposed to IQ tests, if all the science indicates that they are at least somewhat more useful than the next best thing, and that their predictive power generalizes across a number of applied settings (e.g., school, college, work, health, life, and even happiness)?

Although most of the lay criticisms against IQ tests are unfounded (yes, they do predict all of the above outcomes, and yes, IQ is more than socio-economic status), there is one important unaddressed limitation, namely the types of jobs that have so far been examined in scientific studies. Indeed, most if not all of the studies assessing the validity of IQ tests have tried to predict performance on traditional jobs -- these could be more or less qualified, differed in pay, and did examine workers from all sorts of sectors. However, there are virtually no studies assessing the importance of IQ as determinant of success in non-traditional jobs or jobs outside the formal organizational structure.

Recent data show that almost 50% of individuals will be self-employed at some point, and more and more people are engaging in entrepreneurial activities -- in industrialized nations, this increase has been triggered by recent or current recessions; in developing nations, this is triggered by a love of capitalism and a recent or current economic boom. In brief, the world has become a more entrepreneurial place, and there are now millions of self-made business owners all over the globe. Although some of these people may have started working for someone else (a big or small firm), they may have abandoned their jobs to change careers because they were fed-up, de-motivated, too creative, or hungry for more -- that is, they quit because they wanted to make a difference (either financially or psychologically).

Perhaps even more entrepreneurial individuals never even considered working for someone else, either for the same reasons stated above, or because they had anti-social tendencies (the milder term is non-conformity here). What this means is that psychologists have little or no validity data on how consequential a person's IQ is in determining his or her level of success outside conventional jobs: so, how important is IQ when it comes to determining entrepreneurial success?

To answer this question, we have designed a brief online survey to assess the overlap between your entrepreneurial and learning potential. The test is free and gives comprehensive and valid scientific feedback at the end (the feedback is written in non-technical language, so you won't need a Psychology degree to understand it). The aim of the study is to test the importance of learning potential (what some people call "IQ") as determinant of career success in more and less entrepreneurial jobs and among more and less entrepreneurial people. Our prediction is that the correlation between IQ and career success will be lower in entrepreneurial than in traditional job careers, such that IQ should matter more in conventional jobs and for those who are employed. At the same time, we expect higher IQ scores to be associated with higher success levels among entrepreneurs, even though many of them may have failed in their attempt to follow traditional career paths (because they were too entrepreneurial to work for someone else).

Our results will shed light on the validity of IQ as a predictor of a wider range of career accomplishments, especially when individuals' success depends entirely on the quality of their ideas and products (rather than meeting certain organizational targets or a supervisor's opinion of how well they are doing). This has important implications for the science of intelligence testing as results may highlight the fact that (a) entrepreneurial success is driven by factors other than IQ, (b) many employees may have "failed" in traditional jobs because they were too entrepreneurial (rather than low in IQ), and (c) many smart people - in an IQ sense of the word - may have chosen never to work for someone else (which may inflate the reported correlations between IQ scores and job performance).

If you would like to take part in our research, please click here. We are particularly interested in self-employed people, business owners, freelance workers, or people with multiple choices of income.