> And also when "the rich" have more profit, they now want to spend that profit on things, which spawns new luxury good industries.

That will be a rounding error. Economic growth comes from a large population that spends and innovates.

Wealth concentration buys policy and media, and after that all of sudden the following things happen: tax gap widens, public services deteriorates, innovation halting, etc.

Wealth concentration means the pie will shrink, and eventually the rich will have to fear the super rich. And how do you reach growth after a country is sucked dry?

▲ spwa4 6 days ago | parent | next [-]

> Economic growth comes from a large population that spends and innovates.

No it doesn't. Economic growth comes from "doing more with more". WHO does that doesn't matter. It matters for inequality and jobs and a lot of things, but not for economic growth. If skynet kills all Americans and builds 5 million nukes, that will be economic growth.

	▲	exceptione 6 days ago \| parent [-]
		Exactly, doing more with more requires a large population that spends and innovates. It is about allocation. It might sound like a heresy, but the "invisible hand" is for a good part a myth. Resource allocation in the hand of just a few is `a) a hand that indeed tries to hide itself b) a hand that cuts of energy to the rest of its body c) a dying hand` Economics tries to model certain aspects of human behavior as driven by human's psychology, both on the individual and group level. A trading system of other "beings with a different wiring" might be a curiosity, but isn't strictly part of economics. I would rather have economists in general (not directed at you) think a bit deeper about the unspoken assumptions of their behavioral models, to stop confusing models with laws, and to study humans and groups in a broader sense.

▲ intended 6 days ago | parent | prev [-]

As the OP mentioned, growth is different from fair distribution of resources.