What Does an Average Actually Tell You?

Step 1 of 5

An average answers a sharing question.

Pour everyone's amount into one pile, then share it back out equally. Whatever each person ends up with is the average.

Step 2 of 5

Adding and dividing does exactly that.

Adding makes the single pile and dividing by how many people shares it back. The familiar recipe is just that story in symbols.

Step 3 of 5

It hides how spread out things were.

Four people with three each and one person with twelve while three have nothing both average three. The average cannot tell them apart.

Step 4 of 5

One extreme value drags it a long way.

Averages are pulled hard by outliers, which is why average income looks high in a room containing one enormously wealthy person.

Step 5 of 5

The middle value is often more honest.

Line everyone up in order and take the person in the middle. That number resists extremes and often describes a typical case better.

Average UK income is noticeably higher than the median, because a small number of very high earners pull the mean upward.