Saturday, September 10, 2005

Intelligence tests and education

Ross Douthat at the American Scene writes:
Letting employers use intelligence tests, on the other hand, probably would diminish the importance of the B.A., at least on the margins - but I'm very skeptical that most Americans would cotton to the idea of de-emphasizing the resume and re-emphasizing tests, even if doing so would actually increase social mobility.
This is precisely the wrong way to think about education in the labor market: education is not used as a signal to select just for intelligence, it is a signal to select for intelligence and non-cognitive skills. A certain amount of intelligence may be necessary to achieve a given level of education, but it means something more to have achieved that level of education. Thus you could substitute education for intelligence tests (as has been done), but you cannot substitute intelligence tests for education.

Universities do not admit based solely on SAT scores* or IQ scores, at a minimum they also look at GPA. And GPA is not perfectly correlated with intelligence, it is also a function of a student's ability to work. Thus, a university that selects for high SAT and high GPA, is selecting for intelligent and hard working people, which is a subset of intelligent people. So intelligence tests are not perfect substitutes for looking at education.

Further, there is the classic Heckman conclusion that people with only a high school education have higher earnings than those with just a GED, even though they would seem to have the same intelligence (they could complete work at roughly equivalent levels). People who graduated from high school had the non-cognitive skills to stick through high school and do all the work, which is a valuable skill in the workplace; an equally intelligent high school drop out did not have those skills.

For university to stop being such a useful signal, employers would have to figure out an equally good signal of those non-cognitive skills that a university degree demonstrates. As I claimed in an earlier post this is desirable but I don't see how it happens, though I think it will.

*Though in my experience SAT scores don't really track intelligence, for one can easily study for it: my scores on PSATs and the SAT ranged by about 200 points from testing cold to testing having studied, and this wasn't about learning vocabulary or something, it was simply understanding what kinds of mistakes I tended to make.

Update: A very smart comment at The American Scene:
Credentials are not used only to determine who is hired by an organization, they are used to justify why an individual is hired. The reasons for this are both internal and external to the organization. Internally, credentials are used as cya by the hirer. If a manager hires an individual who does not have the minimum qualifications for a position, and that employee screws up, the manager is in a bad position - having to justify the hiring of a person the manager's bosses will see as unqualified (because they will look only at the file). In a world of limited resources and time, the bosses will see that the manager did not hire someone with the minimum qualifications for the organization - and the hiring manager suffers the consequences. The external considerations deal with public policy and perception (and are also cya related, of course). If a white employee is hired with less stellar creds than a black employee, for example, tha hiring organization could be in trouble. The appearance of nepotism is another consideration, especially in a publicly traded company.

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