this post was submitted on 10 Nov 2023
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chapotraphouse

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[–] ped_xing@hexbear.net 3 points 2 years ago

Ratios are probably more appropriate. Let's say we use $100,000 as a reference point. Is a millionaire closer to $100k or to a billion? Subtracting says $100k, and taking ratios also says $100k, because $1M/$100k = 10 < 1000 = $1B/$1M. That's fine, as we agree that excluding people who've just paid off a house isn't the move. Repeating with $100M, subtracting says $100k, but ratios say $1B, as $1B/$100M = 10 < 1000 = $100M/$100k. So ratios align those folks roughly appropriately.

Of course, just using different math can't undo all the problems stemming from using net worth as a class proxy.