Here is an extract from The Numbers Game by Michael Blastland and Andrew Dilnot, which looks at how averages can get distorted:
A Dutch economist, Jan Pen, famously imagined a procession of the world’s population where people were as tall as they were rich, everyone’s height proportional to their wealth (note wealth, not income). A person of average wealth would be of average height. The procession starts with the poorest (and shortest) person first and ends, one hour later, with the richest (and tallest).
Not until twenty minutes into the procession do we see anyone at all. So far, they’ve had either negative net worth (owing more than they own) or no wealth at all, and so have no height. It’s a full thirty minutes before we begin to see dwarfs about six inches tall.
And the dwarfs keep coming. It is not until forty-eight minutes have passed that we see the first person of average height and average wealth, when more than three quarters of the world’s population has already gone by.
What delays the average so long after the majority have passed? The answer lies in the effect of those who come next. “In the last few minutes,” wrote Pen, “giants loom up . . . a lawyer, not exceptionally successful, eighteen feet tall.” As the hour approaches, the very last people in the procession are so tall we can’t see their heads. Last of all, said Pen (at a time before the fully formed fortunes of Bill Gates and Warren Buffett), we see John Paul Getty. His height is breathtaking, perhaps ten miles, perhaps twice as much.
One millionaire can shift the average more than many hundreds of poor people, one billionaire a thousand times more. They have this effect to the extent that 80 percent of the world’s population has less than average.