GDP and low IQ immigration

When I was analyzing the IQ-GDP connection [1], one of the big questions that I never quite got around to tackling, was how much the growing percentage of immigrant populations with lower mean IQ in western countries is expected to retard growth.

See my series on IQ and GDP

Of course that is not immediately a given. It is conceivable that low IQ immigrants to high IQ countries free up smart people for more complex jobs, so that the average productivity doesn’t take a hit. However, in my blogpost IQ-GDP: Ethnicity [2] we analyzed White Africans and Chinese Minorities in South-East-Asia and saw that the relationship between population percentage and GDP is extremely linear. This does not point towards strong non-linear effects. In all likelihood the GDP of a mixed population is roughly the same as the sum of the GDPs predicted by the IQ of the separate ethnic groups.

By the way, this also indicates that the mean IQ becomes unreliable as an economic predictor if the different ethnic groups have very divergent IQs. Namibia and South Africa for example punch way above their average IQ, because of their white minority. This is consistent with purely linear effects, because the exponential relationship between IQ and GDP will mean that the white minority affects the GDP much more than the average IQ.

The question is an important one, because growth is our way to run away from many social ills. It’s when the pie stops getting bigger that the fighting starts in earnest.

Unfortunately it is quite difficult to get accurate data on all the necessary variables. Essentially we are interested in the immigrant fraction of the working age population over time. But not just recent immigrants, but ideally a total breakdown of ethnicities and the size of the mixed population, plus accurate IQ-values. Good luck with that.

Instead I plan on doing a series of simulations, where we calculate how the IQ hit depends on the IQ gap and the fertility rate in Western Countries. We will assume that immigration is used to keep the population size roughly constant, i.e. to replace the missing kids and we will contrast the results with what we would expect if the birth rates had instead been kept at replacement level.

For now let’s contrast GDP per capita [4] and, what better captures the capability of an economy, GDP per capita of the working age population.

Here we see that the Japanese economy starting out with a clear advantage was decisively overtaken by the UK in the 2000s.

However, after controlling for the working age population [3] the story changes. Suddenly growth over the entire 25 years is very similar and Japan regains a slight lead after the 2000s. In our simulation we are going to focus on the working age population by calculating the changing makeup of each cohort.

[1] IQ-GDP

[2] IQ_GDP: Ethnicity

[3] Demographics of the working age population:

[4] GDP by year and country

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