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November 22, 2011

Comments

HS,

I have seen the same effect in more credentialed jobs. In hiring safety engineers and industrial hygienist, the first cut was to screen the resumes for all of the certified Industrial hygienist and safety engineers. We did not even bother to look at any resume of someone who was not certified.

After the first cut, then we looked harder at the resume. The Ivy leaguers are just doing the same thing. Letting the Ivy league admission office make the first cut and then looking harder at what is left. The not wanting nerds is a way to exclude the science and engineering majors from the economics and government majors.

Considering that at least 99% of working people do *not* work for a so-called "elite" firm, this is pretty much meaningless.

HS,

This seems like a rational hiring process. In what way would you say its irrational?

Peter,

Isn't this just another way of saying that 99% of people are meaningless.

I just got banned from Bryans site because I used the word "bullshit" to describe a lot of investment banking services/advice. Hilarity.

There's probably always going to be room on Wall Street for a BearStearns type shop that hires PSD (poor, smart, and a deep desire to be rich).

Hi HS,

I've been reading your blog for a while and this is my first post.

Anyway, you sure University of Michigan ain't prestigious? Ross school of business seems to be at least a semi target school for many of the top investment banks like Goldman Sachs

What is this obsession with elite firms? Most of the richest and most powerful people don't work for these firms so who cares who or how they hire? They are status seeking wannabes.

Groundbreaking analysis, now just do a few more posts denigrating proles and I'm sure the elite will let you in any day now

"In addition to being an indicator of potential intellectual deficits, the decision to go to a lesser known school (because it was typically perceived by evaluators as a "choice") was often perceived to be evidence of moral failings, such as faulty judgment or a lack of foresight on the part of a student."

Faulty judgement and lack of foresight are also intellectual deficits, not moral failings. Whoever wrote this has intellectual deficits.

On the same line, just published by the NY Times:
"A Blow to Pinstripe Aspirations"
http://dealbook.nytimes.com/2011/11/21/wall-st-layoffs-take-heavy-toll-on-younger-workers/?hp

Rather telling when you see bits like "Wharton School is the closest thing that exists to a Wall Street farm team", I can only imagine what they think of State School graduates, now that Wharton is a 'farm team'.

Also interesting is how these laid off recent-graduate now identify with OWS movement.

The article says:

"It was not the content of an elite education that employers valued but rather the perceived rigor of these institutions' admissions processes. According to this logic, the more prestigious a school, the higher its "bar" for admission, and thus the "smarter" its student body."

Using school prestige to filter for IQ and motivation is *entirely* rational -- especially if you, the employer, are not permitted to administer IQ tests yourself.

"This seems like a rational hiring process. In what way would you say its irrational?"

I find it less than rational because it does not utilize IQ scores or other measures that are highly correlated to job performance, although school prestige is a good proxy for IQ based on the schools' SAT score range for incoming students. However, this method does not provide for a work sample at all. The combination of IQ scores with a work sample, integrity test, or a structured interview. For more, see:

http://goo.gl/Hxrp3

Some commentator gave some examples of the "brain teasers" some of these firms now use in interviews instead of written competency test. One of them, a probability analysis based on a tennis match, would have completely sunk me because I've forgotten the rules of tennis, not having played or watched the sport in almost two decades. Which may be the point.

One thing not said is that these people get hundreds, if not thousands, of applications for one position and need to use something to cut the number of resumes down to a manageable number. They could probably just throw out every other resume right off the bat without even looking at them, and from Caplan's description of how resumes are initially read, it seems they effectively do. But I think this is a more interesting question than the question of why the process of managing the unwieldy number of applicants for each position often so arbitrary. Why is there an unwieldy number of applicants these days for every position?

I agree with JP

I blame government intervention

As usual :)

Tanizaki,

What kind of work sample do you think would be relevent for someone that is going to spend 80 hours a week making pitch books for two years? Power point skills?

"integrity test"

lol. Part of what they are trying to recruit is people that don't have integrity. People with integrity don't think ripping people off to make themselves rich is a great career, and that's basically the business these firms are in. You want extreme narcisists for this kind of work.

"structured interview"

If you get passed the initial screens (which is basically what they are talking about here) there will be an interview.

I would say it is somewhat irrational. What it really shows me is that they have tons of truly qualified candidates and therefore can afford to pick favorites based on extras.

I mean if a hundred equally excellently qualified people apply, you can just go for the guy or girl that strikes your fancy.

I find it less than rational because it does not utilize IQ scores or other measures that are highly correlated to job performance, although school prestige is a good proxy for IQ based on the schools' SAT score range for incoming students. However, this method does not provide for a work sample at all. The combination of IQ scores with a work sample, integrity test, or a structured interview. For more, see:

http://goo.gl/Hxrp3

Posted by: Tanizaki | November 22, 2011 at 11:04 AM


You gotta love that study. It is written by Schmidt and Hunter, from two midwest universities, Iowa and Michigan. These guys, as the name of the paper implies, are actually looking for the best employees for a sort of win-win situation. That is not what elite firms are about. Elite firms are already winning. They aren't interested in competing in a free market, they want to maintain their special place for themselves through connections and networking.

>

This part is designed to beat grade or school prestige of unwanted candidates. For example, if a redneck company want to hire redneck, this part will be `ability to fix car' as hobby.

Meanwhile, the nobodies in flyover country were snapping up gold 10 years ago when it was $280/oz. Good thing the statusbots didn't listen to them! What did "they" know?

Since these jobs are ultimately sales jobs, these may be rational criteria. A bookworm may be able to do the daily work better or faster, but law firms don't compete on quality and charge by the hour. Being fast on your feet to impress clients is more important than other forms of intelligence. Some of the articulated reasons seem poor to me, though.

(Law firms are looking for rainmakers. It takes years for people to build their connections and become rainmakers, during which they do grunt work. Investment banks and management consulting are more complicated, but similar.)

Learning about all of these hiring practices makes me sort of happy. I was always under the impression that being black and a woman was a major strike against me but i guess I was wrong. I think that the only place where its a problem is in the dating/marriage arena( most men aren’t attracted to black women)

"it does not utilize IQ scores or other measures that are highly correlated to job performance"

Because that's against the law. Thus the use of proxies (imperfect, but better than nothing) to determine these things.

[HS: Far too broad of a statement. If investment banks gave candidates a test of doing finance stuff like calculating NPV, there's no way it would be classified as being against the law.]

I suspect that the Word Processor has made it unfruitful to use the old screen of binning all the bad spellers.

"What kind of work sample do you think would be relevent for someone that is going to spend 80 hours a week making pitch books for two years? Power point skills?"

I wouldn't know because making pitch books is not my business.

"If you get passed the initial screens (which is basically what they are talking about here) there will be an interview."

What matters is that it be a structured interview. Most employers do not use a structured interview.

"Because that's against the law. Thus the use of proxies (imperfect, but better than nothing) to determine these things."

HS already addressed, and please note that I mentioned the use of university pedigree as a proxy.

Some jobs are more suited to this than others. At my firm, I have advocated that we request applicants to provide LSAT scores along with their GPAs (we always ask for GPA). More than one person has express offense at the idea.

I don't see why an employer could not ask for SAT scores along with undergraduate GPA.

"Also, I think that law firms are a little bit different than other elite firms because (1) they value the top fourteen law schools as ordered by US News, and that list includes two state schools; (2) they care about grades more and extracurriculars less. Law firms hire nerdier people than investment banks."

From what I've heard, the weak economy has restricted the Top 14 to just a handful now. A Yale law school graduate might still have some good opportunities, whereas a "mediocrity" from Georgetown might now be stuck with menial work.

And if I remember correctly, the grades you get at law school are horribly random?

"There probably always will be room on Wall Street for a Bear Stearns type of firm"

How'd that work out?

Why would it be illegal for companies to pick employees based on g loaded tests but it's not illegal for universities to pick students based on the SAT. If companies are not allowed to do it, harvard shouldn't be doing it either especially when almost everyone there denies HBD. What a bunch of hypocrites they are to denounce jensenism while benefiting from g loaded tests to pick their student body.

Quote: (Law firms are looking for rainmakers. It takes years for people to build their connections and become rainmakers, during which they do grunt work. Investment banks and management consulting are more complicated, but similar.)

I think that's basically it. A bank may hire 100 kids for its analyst class, and 90 will leave after their two years are up. From the bank's perspective, where those 90 went to school is not especially important. The work isn't that challenging and as long as the analysts aren't completely aloof socially they will probably do fine.

Where the 10 that stay went to school, however, is of greater importance since over time the job shifts from excel grunt work to more of a sales/dealmaker role. A bank prefers that an MD went to prestigious schools since it is more likely that the MD's college connections will be good for business (roommate is now CFO of F100, guy across the hall is Skadden partner, etc.) Meanwhile, the smart state school guy may know his stuff, but his connections aren't worth anything, and therefore he isn't worth anything to the bank. Since the bank has no way of knowing in advance who will leave or stay, it will make sure almost everyone comes from an elite background.

On another note, I have noticed that hedge funds and other investment management firms are a little more willing to take smart kids from nonstandard backgrounds. However, many of these organizations are just too small to do in-house training and will only hire with experience, and since investment banks are basically the only organizations providing intense entry-level finance training, the funds end up just hiring the 90.

I was always under the impression that being black and a woman was a major strike against me ....

LMAO!

Considering losertarians lack empathy and practical thinking skills, they couldn't careless if talent and IQ go to waste. They don't care if anyone falls down the deep cracks. Work or die is their mentality. They've been infected with the condition called Ayn-osis, which is the unquestioning belief that being ruthlessly selfish in a minarchismistic corporatacracy is beneficial to society.

dearieme, it certainly is fruitful to bin all the bad spellers, but it's no longer enough.

"Why is there an unwieldy number of applicants these days for every position?"

The destruction of labor scarcity certainly plays a part. While this initially harms those at the bottom, this both has a ripple effect upwards, and limits capital investment that would create new jobs.

I do not think this is a matter of market efficiency. It is really a conflict over the "human capital" model vs. the "market signaling" model.

Believe it or not, human capital vs. market signaling are legitimate economic models of human behavior. Gary Becker popularized human capital and Michael Spence popularized market signaling.

Obviously, human capital won out and the human capital propaganda is what permeates the public. In reality, market signaling plays a very prominent role, a lot more than the public is being led to believe.

You should pay more attention to the comments. Tenthring had commented about this same paper back in July.

http://www.halfsigma.com/2011/07/conservatives-and-education.html?cid=6a00d8341bf6ae53ef0154338d7642970c#comment-6a00d8341bf6ae53ef0154338d7642970c

It shouldn't be a secret that extracurriculars are incredibly important. This is not a new development, it was true back in the 1980s, and since my parents knew it was important it must have been true in the early 60s as well. I blame your parents, Sig, for not having a clue on how to direct you.

"On another note, I have noticed that hedge funds and other investment management firms are a little more willing to take smart kids from nonstandard backgrounds."

Quant work requires high IQ, lots of mediocre 120 IQ rich kids can't do it, so they let some nerds in to do the math. That's the best way for a poor kid to get in, worked for me. Still, quant work is a minority of WS work and its pretty hard, whereas general IB work is easy (long hours, but easy) and provides the bulk of jobs.

What are "elite firms" in this context? McKinsey, BCG? Remember those firms have a up out out policy, meaning you have to be promotef or find another job. Of course that is not so hard with experience from McK, but chances are most wont stay at these elite firms too long and end up with a high position in a non-elite firm.

Speaking of elite...

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As espoused in their “co-created positive wedding affirmations” in this video:

http://www.youtube.com/watch?v=Iixfj7XmOzE

"I suspect that the Word Processor has made it unfruitful to use the old screen of binning all the bad spellers."

Ha, if only it were so. As a grader of undergrad papers and reader of resumes, I can assure you that word processors have by no means eliminated poor spelling and grammar.

"A bank prefers that an MD went to prestigious schools since it is more likely that the MD's college connections will be good for business"

What's this about MDs working for banks?

[HS: Managing Director]

Nothing new here.

Branding matters especially for client facing businesses, such as management consulting, investment banking and law firms. Period.

btw, if I were to complain about an industry that hires only from the ivies wouldn't be management consulting/investment banking/law firms but media! In media, generally, you need to have finished Harvard/Princeton/Yale.

"Some commentator gave some examples of the "brain teasers" some of these firms now use in interviews instead of written competency test. One of them, a probability analysis based on a tennis match, would have completely sunk me because I've forgotten the rules of tennis, not having played or watched the sport in almost two decades. Which may be the point."

I read the question, and it's very difficult. If A loses the last serve, he has a 2/3 chance of winning the next; if he wins the last serve, he has a 1/2 chance of winning the next. So if you take it forward two serves (you need to be up by two to win), you get four scenarios: AA, AB, BA, and BB. AA and BB mean the game is over. But AB and BA means we're back to deuce, and the game goes on. But BA is different from AB because in BA, B has a 50-50 shot of winning the next serve, whereas in AB, he has a 66-33 chance of winning the next serve. So you really have to carry that part forward. You have to figure out the probability of A winning if the last serve was A, or if the last serve was B.

How can we work to undermine these types of firms, who could care less about intelligence and character and instead reward kids with merely the good fortune to be born to parents with the wealth and social connections to get then involved into lacrosse or squash at a young age so they could stumble into Yale with a 1300 SAT?

Husker Don't has an interesting explanation of the investment bank selection process, which is completely opaque to me.

I have a question, if the end result is to produce a class of good dealmakers/ rainmakers, why select from a pool of trained analysts in the first place (I think analysis will be devalued on Wall Street as the degree of market manipulation and bailouts increases, but that is a comment for a different post)? Why not higher straight from the ranks of brokers/ salesmen, whose skills are more directly related to what seems to be IB work. Instead of taking a pool of analysts, and trying to find who are aggressive and have the best people skills, take a pool of salesmen, and find the ones that are the most intelligent and have the best understanding of how the markets work.

Perhaps regulation preventing investment banks from owning retail brokerage firms played a role, but my understanding that such regulations existed but were gutted in the late 90s.

Ed,

Dealmakers/rainmakers aren't acquired, they are made. You want to make them from the right kind of clay (mostly, well off kids from Ivies that come from the right families). If you take some low IQ prole who is good at hawking stocks to doctors in Wisconsin those skills aren't going to translate to being able to do billion dollar deals with people three generations deep into wealth.

Additional factors that's more important than the ones previously mentioned.

- Family or social networking and connections. Legacy and fraternities all the way. The OB network is still alive and well.
- Certifications
- Foreign Languages (If you speak five languages, you could equal five other people. It also demonstrates your triple digit IQ.)
- Manners and etiquette (Where one's English comes to play.)

Glad to see HS is refocusing on informative and relevant issues again.

Ed -

"Why not higher straight from the ranks of brokers/ salesmen, whose skills are more directly related to what seems to be IB work. Instead of taking a pool of analysts, and trying to find who are aggressive and have the best people skills, take a pool of salesmen, and find the ones that are the most intelligent and have the best understanding of how the markets work."

Because there is a wall of separation between I-Banking and Brokerage.

I graduated from the University of Chicago with a degree in economics and lots of math classes under my belt. The brokerage job that I applied for basically told me I was over-qualified for the work.

" if I were to complain about an industry that hires only from the ivies wouldn't be management consulting/investment banking/law firms but media!"

That is very true. There is almost no "objective" criteria for success in media so credentials are everything. In banking and consulting it is a little easier for a scrappy state school grad with good math skills to demonstrate he can outperform a rich Ivy kid in analytics or portfolio management.

'Quant work requires high IQ, lots of mediocre 120 IQ rich kids can't do it, so they let some nerds in to do the math.'

Now, I'm not sure why 120 IQ isn't plenty to perform quant work. It's not as though they are mathematics PhD's attempting to contribute to the field.

My guess is that rich, upper class individuals would not enjoy such a job because in a lot of ways they think of it as menial.

----

As far as law firms go, good grades are probably a little more important than the school's credentials. So long as an individual didn't go to a T4 rip-off school, landing at the top of their class demonstrates---at the very least---commendable work ethic.

[HS: School prestige is more important than grades for law firm hiring. But they do consider grades. For very top firms, you could only get in from a lesser T-14 if you are in the top 10% of the class. But anywhere in the class at Havard Yale Standford would be OK.]

'School prestige is more important than grades for law firm hiring. But they do consider grades. For very top firms, you could only get in from a lesser T-14 if you are in the top 10% of the class. But anywhere in the class at Havard Yale Standford would be OK.'

Yes, that is the conventional wisdom. What do you think of this study, though?

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1640058

"'Quant work requires high IQ, lots of mediocre 120 IQ rich kids can't do it, so they let some nerds in to do the math.'

Now, I'm not sure why 120 IQ isn't plenty to perform quant work. It's not as though they are mathematics PhD's attempting to contribute to the field."

I don't think so. Top pure math PhD and elite quant are just two different skillsets. Being a quant at Jane Street or SIG requires the ability to do lots of simple math in your head quickly and with no errors. For example, what is 16 * 55 * .17? Almost no one has this ability, so these firms need to recruit widely and interview lots of applicants. If they could just go to Math PhD programs and get all of the needed people, they would do that.

Tennis Match Solution:

We want to solve for the probability that player A wins given that we start that player A lost the last serve.

Let "A" be player A won the serve and let "B" be that player A loses the serve. From the problem:
P(A|A) = 1/2
P(A|B) = 2/3
P(B|A) = 1 - P(A|A) = 1/2
P(B|B) = 1 - P(B|A) = 1/3

In tennis, a win (or loss) must be by at least two points. Since the game is at 40-all, the winner will be the first player who wins two consecutive serves, and the game will continue until one player wins. This gives us two sets of four probabilities as follows:

P(AA|B) = P(A|B)*P(A|A) = 2/3 * 1/2 = 2/6
P(AB|B) = P(A|B)*P(B|A) = 2/3 * 1/2 = 2/6
P(BA|B) = P(B|B)*P(A|B) = 1/3 * 2/3 = 2/9
P(BB|B) = P(B|B)*P(B|B) = 1/3 * 1/3 = 1/9

and

P(AA|A) = P(A|A)*P(A|A) = 1/2 * 1/2 = 1/4
P(AB|A) = P(A|A)*P(B|A) = 1/2 * 1/2 = 1/4
P(BA|A) = P(B|A)*P(A|B) = 1/2 * 2/3 = 2/6
P(BB|A) = P(B|A)*P(B|B) = 1/2 * 1/3 = 1/6

Given that a win is either two consecutive successful serves in this pair or the probability of a win in a future pair if the game continues, we have:

P(win|B) = P(AA|B) + P(BA|B)*P(win|B) + P(AB|B)*P(win|B)
P(win|A) = P(AA|A) + P(BA|A)*P(win|A) + P(AB|A)*P(win|B)

By substituing values, we can see that the solution reduces to a simple pair of linear equations with two variables, x=P(win|B) and y=P(win|A). We want to solve for x, P(win|B).

x = 2/6 + 2/9 * y + 2/6 * x
y = 1/4 + 2/6 * y + 1/4 * x

With some algebraic manipulation, we get

24x - 8y = 12
-9x + 24y = 9

and

x = 15/21 or x=5/7

Thus, the solution to is 5/7, which also fits our intuition that player A should be likely to win more than 1/2 of the time since player A wins a single serve either 1/2 or 2/3 of the time.

I think that this is an intermediate yet tedious problem, but I was initially intimidated when I first read the question, and I doubt that I would have been able to formulate this problem in an interview if not for the hint in the comments about AA, AB, BA, and BB. I am a graduate student in computer science. Let me know if you find any flaws in my solution.

Haven't been able to comment for a while.

All very good. Keep it up.

Rich and poor libertarians want to believe that the world is just. Social psycholigists even have a word for it: the just world phenomenon.

Libertarians and Friedman-type economists ARE so lacking in introspection and are so unreflective they CANNOT see this cognitive bias in themselves.

Knowing that the world is shitty and filled with people who think right and wrong are just meaningless words AND that you are powerless to do anything about it is unbearable for the intellectually immature so all day long every day they explain to themselves why the way things are is the way they should be and if they can't explain it then this is only a lack of sophistication on their part.

"Yes, that is the conventional wisdom. What do you think of this study, though?

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1640058"

Wow! That study is great news! It totally rips half sigma and his liberal followers to shreds. It shows that grades are a far better predictor of how well a lawyer does in life than the eliteness of his law school. This shows the market rewards actual merit over credentials. The lawyers who were smart and hard working enough to get good grades are also the lawyers who are smart and hard working enough to make the big bucks.


So we do live in a just world after all, contrary to all the whining of half sigma and other liberals. That is great!

'Being a quant at Jane Street or SIG requires the ability to do lots of simple math in your head quickly and with no errors.'

How is arithmetic a g-loaded skill? It involves memorization. Several books out there teach you how to become a calculation whiz. If an Engineer only needs an IQ of 115, I'm not sure why 120 isn't enough to do these calculations. Perhaps you're underestimating the brain power involved with levels of IQ.

"The latest news to rock the PUA world and take game to the next level.

David De Angelo aka Eben Pagan, CEO of DoubleYourDating and the singlemost financially successful PUA guru in the history of game, has simultaneously come out as bi-sexual AND married a physically unattractive bi-sexual Caribbean woman who happens to look like him!"

Hilarious! Where can I read the PUA community debating this?

"Considering losertarians lack empathy and practical thinking skills, they couldn't careless if talent and IQ go to waste. They don't care if anyone falls down the deep cracks. Work or die is their mentality. They've been infected with the condition called Ayn-osis, which is the unquestioning belief that being ruthlessly selfish in a minarchismistic corporatacracy is beneficial to society."

I don't see what your comment has to do with the article. I reckon there are very few self-identified "losertarians" at elite schools and institutions to begin with. If a substantial portion of the elites believed in libertarianism, then explain why we're living in a corporatist, nanny state? It's because the elites are libs, not 'tarians.

Libertarianism is the domain of those in engineering and science, particularly where computers are involved. It is not the calling of high-powered law/finance/consulting types. Individuals from the latter groups are pretty much all lib-Dems, I would imagine...

Libertarianism, being the most logical, rigorous and intellectual political ideology, appeals to the geeks and nerds of the world. The high-IQ, low social skills crowd. The average computer programmer, in other words.

As one would imagine it to be, so it is.

Half-Sigma I think you are being a bit disingenuous regarding your critique of how elite firms hiring departs from economic rationality. First of all, remember that because of AA, companies are in fact prohibited from using any form of standardized testing to screen applicants. This is an example of how the indirect costs of affirmative action are probably much larger than the direct costs. Anyway, in lieu of the fact that IQ tests are verboten, firms fall back on credentials and the prestige of the university or college of job applicants. Since Harvard, Princeton, Stanford, or Yale are more prestigious than Michigan, North Carolina, Texas, or Wisconsin that's how they hire. If standardized tests were permitted and revealed that a particular public school graduate was smarter than his Ivy League counterpart it would be harder to justify that decision rationally, and would provide information that challenged that decision. No such data exists or is allowed to exist, so it is easier for the fools in HR to treat everyone as if they had a equal chance of going to an Ivy League school or even wanted to, and then use the prestige of the graduate's university as the deciding factor.

AA in effect leads to the reestablishment of the old boys network, although it now includes girls as well. I think Steve Landsburg used an example of companies discriminating in favor of college graduates over non graduates as an example of a stealth intelligence test without mentioning AA directly, but it clearly would apply all the way up the university prestige scale for employers. Bachelors degrees recipients over non grads, MBA's over bachelors only, More prestigious state universities over less prestigious ones, Ivy League schools ( With some exceptions, like Stanford or Chicago ) over anyone else and so on and so on. Perfect example of a lack of understanding or even acknowledgement of HBD leading to socially undesirable consequences.

"How is arithmetic a g-loaded skill? It involves memorization. Several books out there teach you how to become a calculation whiz."

Actually factor analysis of the WAIS-IV finds that the Arithmetic sub-test is now the MOST g loaded of all the Wechsler sub-tests (one study found it was the most g loaded; another study found it was the second most g loaded). The reason for the rise in Arithmetic's g loading is perhaps that in the age of calculators, people no longer practice arithmetic skills very much so they must rely on g instead of experience when solving such problems. Another reason for the high g loading might be that solving arithmetic problems like "How many slices of pizza are in 17 boxes if each box has 6 slices?" requires several different mental abilities: verbal comprehension, working memory, logic.

"First of all, remember that because of AA, companies are in fact prohibited from using any form of standardized testing to screen applicants. "

This just isn't true. McKinsey, Bain, and BCG all ask for standardized test scores. Many finance firms ask for standardized test scores.

Proprietary trading firms that require unique intellectual abilities give their own tests because they cannot simply take 10 math PhD's from Harvard and be reasonably sure that half of them have the type of abilities they are looking for. They NEED to use their own tests. Investment banks on the other hand are not looking for truly intellectually gifted, and there are always more than enough quality applicants at the top 15 schools, so there is no reason to go any further.

"'Being a quant at Jane Street or SIG requires the ability to do lots of simple math in your head quickly and with no errors.'

How is arithmetic a g-loaded skill? It involves memorization. Several books out there teach you how to become a calculation whiz. If an Engineer only needs an IQ of 115, I'm not sure why 120 isn't enough to do these calculations. Perhaps you're underestimating the brain power involved with levels of IQ."

I'm sure that it is g-loaded, but it is not the same thing as g. I know people who are top math students who have failed the Jane Street test.

The questions are along the lines of "Without a calculator or writing anything down, what is the square root of 25 * 34 * 11 * 0.034". Engineering certainly doesn't require one to be able to store that many numbers in one's head and it definitely doesn't require manual calculation of difficult square roots.

"Remember, the math section of the pre-2006 SAT exam only correlated with IQ at 0.8"

I meant 0.7

'Actually factor analysis of the WAIS-IV finds that the Arithmetic sub-test is now the MOST g loaded of all the Wechsler sub-tests'

What study?

Are you all saying that there are not several already discovered shorthand methods for mental calculation?

Even if the process of inventing the shorthand methods takes some measure of 'g,' I find it hard to believe that a bright individual (115+) couldn't readily capitalize on those methods.

I see a lot of discussion of IQ on this sort of thread that suggests to me that a lot of people clearly have no concept of what it is to be smart.

I know my own limitations in the quant area. I don't stress about whether I could train myself from the seventy-something percentile to the eighty-something. Maybe I could. Big deal. I would still be a dunce in the greater scheme of things. How do I know this? I am a 99 point something on the verbal side. And it takes no effort. Zero. It's like walking, or being able to throw a ball straight (if you're just really good at that). So I have no difficulty believing that some people find the 'hard' stuff just as easy.
Gilbert P.

A few years back I had a superday at one of the BB banks, and they started the day by having all of us go into a large auditorium in the office and take something like this

http://www.psychometric-success.com/practice-papers/Psychometric%20Success%20Diagrammatic%20Reasoning%20-%20Practice%20Test%201.pdf

This company definitely has a legal department that would know better, so I guess I'm confused on the actual rules surrounding this sort of thing. Are tests only banned when they are the sole factor in hiring and they lead to disparate impact? Can you test as long as it is part of a holistic evaluation? HR was very clear that no decisions would be made based on the results (well then why are you wasting our time with this...)

the GMAT,LSAT,SAT,GRE, and the ACT exams are not IQ tests and should not be used as such.

Generally speaking and in this economy in particular, hiring staff will use anything to disqualify people.

Funny thing about the school systems and ranking so much rank inflation going on that many schools are being sued over their misrepresentations about being competitive with top tier schools. anyway bye bye

"Remember, the math section of the pre-2006 SAT exam only correlated with IQ at 0.8"

I meant 0.7

"the GMAT,LSAT,SAT,GRE, and the ACT exams are not IQ tests and should not be used as such."

Neither of you knows what an IQ test is.

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