Think using retained earnings for stock buybacks to increase the stock price and increasing CEO compensation instead of investing retained earnings productively in capital expansion, R&D, etc, or distributing it to shareholders.
Piketty's "capital" includes both real and financial wealth. The balance between real and financial is significant. Financial wealth can be growing substantially owing to change in valuation that is largely the result of rent seeking that adds nothing real, while real capital remains constant or even depreciates. It's a form of looting a firm.
Almost no space has been devoted to looting as factor in increasing inequality, and rent seeking is only recently being appreciated, although it remains greatly under-appreciated.
Piketty and the fixed-investment rate
Merijn Knibbe
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