That is the opposite of a problem - it emerges because we have tools that make things more efficient than just throwing toiling bodies at it. We had economies which were based upon it, it was called slavery. Capital compounding its gains through better capital is how we get progress. The presense or absense of the capital advantage is part of what separates third world wages from first world.

The industrial era problem isn't capital but that economies of scale encourage consolidation heavily and make running small business an even more uphill battle. There is at least a counterbalancing force of competitive pressure and antitrust to promote some splitting for innovation's sake as opposed to just one big stagnant monopoly winning out just because it is biggest.

I was mind blown when i found that this is a major investment thesis in argentina.

Argentina is a special case.

When inflation is absurdly high like in Argentina, Economy does not make sense any more.

Basic economic assumption are not true and you get things like that or that "spending" is actually "saving".

I don't think it relates.

At federal minimum wage, you make 15k a year. NASDAQ 100 is on average 14.6% per year. It only takes 100k to passively earn more than the vast majority of labor.

We have arrived to the point where capital is vastly more important and productive than labor. AI has only make that worse. Historically, there has been a balance because it was Capital and labor that were required to generate outsized returns. But once you strip out incremental cost with software, and tack on an AI "service" layer, where are the need for employees?

The one saving grace, is that this will also break the VC model. When one youtuber who has 100k subs can spin out 20 different apps a year, we fragment the app space, allowing alot of micro businesses to form around "brands". But "brands" will just be social media influencers.