Genetics and Socioeconomic Status: Some Preliminary Evidence on Mechanisms

Leandro S. Carvalho

Journal of Political Economy Microeconomics, 2025, vol. 3, issue 3, 429 - 476

Abstract: Does genetics influence one’s economic prospects? I exploit randomness in the genetic transmission from parents to offspring to estimate causal genetic effects. The genetic measure is the polygenic index (PGI) for educational attainment. High-PGI individuals have higher incomes largely because of their schooling and occupational choices: they get more education and sort into better-paying occupations. Genetics seems to drive individual differences in the marginal benefits and costs of schooling. The evidence suggests that fluid intelligence and self-control partly mediate the relationship between the PGI and education. Genetic effects are economically meaningful, comparable in size to effects of family environment.

Date: 2025
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