In an alternate reality, the world is governed by geniuses. Geniuses may debate on which economic/social theory is most applicable to our world leaving the peasants to fend on their own. Or they may be too engrossed in their own thoughts and forget about the world around them. Isn't it likely that genusies will never rule effectively?
Many of the answers and comments seem to assume that geniuses are simply the smartest people in the room. This was a phrase used about the people who ran Enron. That didn't end well.
There is more to genius that simply being smart, intelligent or having a high IQ. It also includes being highly motivated and focused, and working very hard. This means they're usually workaholics. Also, because they spend more time thinking about, studying, and working with their area of expertise they end up knowing and understanding more about it than almost anybody else.
This isn't exclusive of science and engineering, art, music, and, yes, politics too. There are obvious political geniuses. Politicians who can communicate their ideas, their vision, and where they want their political institutions to go. This can be for good or ill. For every good politician of stature, we can always name a bad one. We've seen a few elected recently, and there's a few running for election somewhere right now.
This doesn't need to be at country level, it could be in local government, or state and provincial level. Even in your local club or society, so expect a demagogue to take command of your neighbourhood tennis club and rule it for a thousand years.
If this model resembles the world as we know there's a reason. Basically many politicians are intelligent, highly motivated and determined, display all the characteristics of a workaholic, believe in what they're doing, usually they have a strong self-belief in their ability to achieve their objectives, and sometimes they have an interesting capacity for self-deception. While they display many of the characteristics of genius they are trying to deal with complex, chaotic and unpredictable human social systems, they will fail more often than they succeed. More than genius is required to control any society. They have their share of human failings.
Our conventional model of a genius would be closer to the theoretical physicists who wrestles with mathematical concepts and what happens in nature. These geniuses don't confront deceit or contrariness or intractable political institutions, this make them look more brilliant than they otherwise are. Unlike their cousins in political genius who are readily undone by lies, backstabbing, betrayal, conventional ideologies, and entrenched self-interest.
If this is dystopia, then we are already there and we have been for all of history. It's not good, but it's not too bad, because remember it could always be worse. There are parts of our planet where is it is definitely worse.
Quality of government is determined by leadership not intelligence
The ability and skill of a person to lead matters far more than their intelligence. If the leader was intelligent and had no leadership abilities they would make the same types of mistakes as someone with normal intelligence who also had no leadership abilities.
A good leader knows to surround themselves with wise counsel and listens to those below them and around them. The ability to do those types of things is independent of IQ. So you would have the same chance of a government turning into a dystopia regardless of how smart the leader is.
Not all geniuses would govern well - you are correct. There is always a posibility of selfishness or self-preferece. That doesn't mean that geniuses will never rule effectively.
A) Intelligence and Leadership are not Strongly Correlated
While some intelligent people may abuse power, there is no strong, widely proven correlation between intelligence and corruption or abuse. Furthermore, a group of intelligent people would probably peer-review each other - straining out all selfish or unwise decisions. Finally, if elected democratically, these people may have some sense of morality - people generally like morals in leaders. They may not be perfect, but as intelligent people, they will be far from bad at their jobs, and they will consider the needs of others, as everyone does.
B) "Dystopian" is Different from "Bad"
Even if intelligence is correlated with corruption, although it isn't, there is no reason to call a poorly governed society a dystopia. Dystopias involve total, pervasive lack of goodness, morality, or habitability. If a government neglects the majority of people, then those people may freely find a new government, make a new one, start an anarchy and overthrow the geniuses, or continue with their normal lives while disagreeing with those in power. That is not the same thing as "everything is bad".
What is your definition of "genius"? When I think of a genius, I generally think of a great scientist.
But there's no reason to believe that a brilliant nuclear physicist would make a good king or president, or that he would make a particularly bad king or president. Knowledge of physics has very little to do with ability to lead a nation. Presumably such a person is generally smarter than the average person, so maybe he wouldn't make the sort of dumb mistakes real leaders do. On the other hand he might know he's smarter than the average person, and he gets egotistical and thinks he knows everything, and so he makes stupid mistakes that someone with practical experience wouldn't have made. Like, suppose we are considering what sort of government assistance to the poor we should have. Some say we are encouraging people to not bother to work and just live off welfare; others say that's a non-issue and only a tiny minority would accept welfare if they could get a decent job. Whose opinion would be more valuable in such a debate: A brilliant nuclear physicist who has spent his life doing research at a prestigious university? Or a waitress making minimum wage who has been on welfare in the past and knows many poor people? But I wouldn't be surprised if the brilliant nuclear physicist gets it in his head that because his IQ is 160 and hers is 85, that he needn't bother listening to her opinion.
Are geniuses, as a whole, more or less moral than the average person? Fiction is full of "mad scientists" who think the pursuit of knowledge is more important than the lives of the peasants. And in real life there have certainly been such people: the Nazi scientists who performed barbaric experiments on concentration camp inmates are an extreme but certainly real example. On the other hand there have been medical researchers who devoted their lives to curing disease. And in the middle are many scientists who are absorbed in their work, who don't really care very much about people besides their own friends and family, but who wouldn't be thoughtlessly cruel.
Some geniuses get fanatical about their ideas. There have been plenty of political leaders in history who were so devoted to the utopia they wanted to create that they would crush and destroy anyone who stood in their way. They loved humanity so much that they hated people.
So all told ... I doubt that genius scientists would be particularly good rulers. I'd be very nervous about genius politicians with visions of utopia. What I'd really like, of course, are rulers who are so smart that they agree with me on all political issues but are more capable at turning them into reality. :-)