[icebraining]

Wealth transfer is the natural result of any system that rewards the deployment of capital with more capital.

That's not what capitalism does, otherwise the Webvan investors would be massively wealthy.

It rewards effective deployment of capital with more capital. And it often rewards ineffective deployment of capital with less of it. So you can have massive transfers of wealth from "side to side", not necessarily from bottom to top.

[candu]

Sure - but "effective" here is essentially a random variable, and the central limit theorem does the rest.

"Wealth transfer" isn't transfer to/from particular individuals. As a group, the wealthiest will tend to accumulate wealth faster than everyone else. Furthermore, it may be possible for individuals to enter/leave this class, but it gets less likely the further you are from the dividing line.

[chimprich]

On the whole, though, it is fairly easy to make more capital with capital (e.g. tracking the stock market, at least in the medium term). And the more capital you have, the easier it is to make more capital. In general, having more capital offsets deploying it effectively.

[sanderjd]

Certainly there are clear mechanisms for wealth transfer from both bottom to top and side to side. What is more interesting to consider is: What are the mechanisms for wealth transfer from top to bottom? From what I can tell, that sector is shrinking – as mass deployment of labor diminishes in importance – and has little prospect of recovery outside of government intervention. Would love to hear some different perspectives on that.