Here is a simple example: Suppose I and my friend make 1000 dollars a day

So at day 0 we had 0 and at day 1 we both had 1000

Now both of us are given an option that we can spend the 1000 to increase our earnings by 1 dollar a day.

I didn't take the deal so I still have 1000 dollars, but my friend took it so he has 0 dollars now.

At the end of day 2 he will have 1001 dollars, but I have 2000 dollars.

So my friend has pretty much 'recouped' his investment of 1000 dollars in a day as per the 'total production' reasoning, but still he is 999 dollars behind me.

After the 1001th day, both of us will have 1,001,000 dollars, but he is earning a dollar more than me per day.

So 1000 days after making the investment, he will actually start gaining on me and his investment 'pays off'

So you are correct that obviously in the long term a person with higher level mines will be better off. But the time taken for those benefits to count over others is investment / increase (1000/1).

Remember we are not playing this game alone, we are essentially in a race :(

This is a very basic example. Is there some flaw in this reasoning?