Capital in the Twenty-First Century
Inequality grows if rate of return on capital is greater than the economic growth. That is, when the average returns on capital (such as dividends, interest, rates, and profit) are higher than the economic growth (growth of society’s income/output) people with more capital tend to cumulate more wealth, increasing their income even more. This in turn accelerates the growth of the gap between wealthy and poor.
Title: Capital in the Twenty-First Century
Author: Thomas Piketty