If the terminology is the same as automotive transfer cases the ratio refers to a "gear down", not a "gear up". For example, many pickups have a transfer case ratio around 2.5:1 in low. This means that the output speed is reduced by this ratio - 2000rpm input would result in an 800rpm output using this 2.5:1 example. However, in a tractor they could have used a step-up ratio to reduce torque loads on the drivetrain then use deep-reduction final drives to reduce the speed at the wheels. Is this a single-speed transfer case or a multi-speed unit? If it is a two-speed and is direct drive in low and running through the gear ratio in high than it is a step-up ratio and vice versa.
You probably want something fairly close to what you have to prevent ending up with some transmission gears that are of little usefulness by being too slow or fast, especially if this is a single-speed transfer case. In low gear most tractors have more wheel torque than they can use anyway due to limited traction so gearing down more will not gain you anything in terms of pulling power. You'll just end up using a higher gear in the transmission to do the same work and will be slower going down the road. On the flip side, if you gear up too much it would mean first gear might be too fast for some jobs and high gear could be dangerously fast.
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