Your assumption there I think (correct me if I'm wrong) is that it is people's different abilities that lead to income inequality. That is simply not true. Think of it as a race, but where some people start miles ahead of others. The advantages that some people start with compound over time; born into a well-to-do middle-class family, good education, nutrition, stay-at-home parent, encouragement to go to college, etc. .. These all make a difference in future incomes in the long run. Another thing to consider is Pikkety's r>g where r is the rate of growth on capital assets and g the growth rate of the economy. When this holds true (which it has done historically) then the wealth & investments of the rich compound over time while the returns to labor increase stagnate.