How do we compare rich people over time.

Hello. We are a newspaper based in Barcelona, Spain, founded in 1881. We are writing an article about the wealthiest people in history, inspired by an article in Bloomberg Businessweek on May 21st citing your site. I would like follow up that pieces with a few questions to help us with our article. Thank you in advance.

QUESTION  1,  Is the ratio of wealth to GDP the best way of comparing fortunes through history? Which are the main alternatives?

ANSWER.  It is the most often used and has the advantage of not having to deal with the mix of output.  (There were no antibiotics available to the richest person on earth before they were invented.)  By using the share of GDP index you are comparing what we call the “economic power” of the individual.  That power can be used in the market to control the use of resources.  Of course absolute monarchs have this power and do not have to use the market, so in some sense the size of their wealth is not as important as their power to expropriate.

QUESTION 2.  Can we consider John D. Rockefeller as the wealthiest person in history? Some rankings cite Genghis Khan, for example. Do you consider this kind of rankings as accurate? Can we really compare wealth through history or we have to limit it to its context?

ANSWER: It is useful in comparing two private individuals that have a large amount of wealth in a market economy and cannot expropriate for comparison over time.  Using a wage or income index could also be instructive. We seem fascinated at how much more CEOs make today as a proportion of their workers.  It could easily be of interest in the past.

As for Genghis Khan, he was an absolute ruler, he did not need monetary wealth to command resources, so I do not see an easy way to compare him with Rockefeller.  Perhaps with Alexander the Great?  And then there is Gaius Appuleius Diocles, the Roman chariot racer who was regarded as the richest athlete in history and perhaps the richest person in the Roman Empire.  How do we compare him?

How much was £10,000 in 1700 worth to the Duke of Marlborough?

QUESTION:  I have been reading Churchill’s Marlborough: His Life and Times, and I have been trying to get a grip on how much it was that the Queen was actually giving him. I see that £10,000 in 1700 could be worth anything from £1.3 Million to 250 Million, and I am still puzzled as to which figure to have in mind.

ANSWER:  To use £1.3 Million is silly as that is using the RPI and is measuring relative prices of goods and services.  Marlborough was receiving an “income”, so using relative GDP per capita would be much better at £25.6 million.