Further evidence on the link between time preference and cognitive ability from PNAS:
Economic analysis has so far said little about how an individual's cognitive skills (CS) are related to the individual's economic preferences in different choice domains, such as risk taking or saving, and how preferences in different domains are related to each other. Using a sample of 1,000 trainee truckers we report three findings. First, there is a strong and significant relationship between an individual's CS and preferences. Individuals with better CS are more patient, in both short- and long-run. Better CS are also associated with a greater willingness to take calculated risks. Second, CS predict social awareness and choices in a sequential Prisoner's Dilemma game. Subjects with better CS more accurately forecast others' behavior and differentiate their behavior as a second mover more strongly depending on the first-mover's choice. Third, CS, and in particular, the ability to plan, strongly predict perseverance on the job in a setting with a substantial financial penalty for early exit. Consistent with CS being a common factor in all of these preferences and behaviors, we find a strong pattern of correlation among them. These results, taken together with the theoretical explanation we offer for the relationships we find, suggest that higher CS systematically affect preferences and choices in ways that favor economic success.
- Burks, Stephen, Jeffrey Carpenter, Lorenz Goettec and Aldo Rustichini, 2009, "Cognitive skills affect economic preferences, strategic behavior, and job attachment". PNAS. doi: 10.1073/pnas.0812360106
Unfortunately, our library's gateway for external access to PNAS seems to be down; the full paper's certainly worth reading, and I'll have to do so when I'm back at work.
Folks fond of de gustibus assumptions previously could handle IQ heterogeneity by saying it just tilted the budget line: higher levels of educational attainment are cheaper for folks with greater cognitive skills, and so on. If IQ hits time and risk preferences directly though....
HT: Gene Expression, where Razib recently pointed out the best strategy for increasing your kids' IQ:
So the best way to increase the intelligence of your offspring? Fuse your gametes with someone intelligent! You don't even have to believe in intelligence to do this, as many who do just this don't. The main issue isn't that people won't be a position to fuse their gametes with individuals in the same range as themselves in terms of intelligence. Rather, it's that they won't let the fusion come to fruition!