All Hail the Percentage Sign! %! %! %!

Jan 14, 2013

Big news! The formerly humble percentage sign has received the coveted “Symbol of the Year Award” from the Stanford University Symbolic Systems Program. Well, OK, the percentage sign received the first such award. The announcement came on last Saturday’s Weekend Edition, in a visit from Keith Devlin, NPR’s “Math Guy” and himself a math professor at Stanford.

The award is richly deserved. Are there any followers out there of the U.S. political debates of the last year or so, who don’t recognize the significance of “99%”? “1%”? Or how about the “47%” epithet that helped drive a stake into the heart of Mitt Romney’s run for president?

Not that I want to turn a mathematical symbol into a swellhead, but the percentage sign has an importance far beyond a few memorable, albeit fleeting and sloppily used statistics. A percentage sign is an indication of a ratio – that is, nothing more than one number divided by another number. Ratios are absolutely critical to our understanding of raw numbers that in themselves are incomprehensibly large or small, or for which we have no context. Here are some examples of ratios, where the numerator is typically expressed as a percentage of the denominator:
  • Profit margin – profit, divided by revenues
  • U.S. federal debt burden – debt owed by the government, divided by gross domestic product
  • Interest rate – the amount of interest paid (or earned) in a year, divided by the total amount owed (or invested)
  • Growth rate – the change in (pick your metric) since the last time period, divided by last period’s value of (the same metric)
  • Batting average – base hits, divided by total official times at bat

Without percentages, and by extension without percentage signs, numbers would be incomprehensible.

If there is ever a Symbol Hall of Fame, the percentage sign should be the first inductee.

“Painting with Numbers” is my effort to get people talking about financial statements and other numbers in ways that we can all understand. I welcome your interest and your feedback.

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