Mark has a great comment on issues with interpreting what a dollar is worth. This idea is worth considering in Epidemiological studies as well. When trying to model socio-economic status, it can be tempting to treat income as a linear variable. Even worse, it can be tempting not to account for differences in costs of living. This reluctance to try and account for cost of living is an understandable temptation as the data on cost of living is extremely hard to generate and very context specific. How do you handle Manhattan (where a large house is unlikely to be even available, let alone affordable) when you compare it Duluth, Minnesota. Economics have some clever tricks, but they replace one source of error (incorrect standardization) with another one (modeling errors in the cost of living models).
But it is worth remembering that just because it is a clean number doesn't mean that you should just introduce it into the model "as is". Think long then model!
1 hour ago