> If r (the rate of return on capital) is less than g (the growth in output) that means that people have no incentive to build wealth or become more intelligent

> If r (the rate of return on capital) is less than g (the growth in output) that means that people have no incentive to build wealth or become more intelligent to deploy that capital more profitably. If I'm never going to make more than the growth in output, why bother with capital? You can still spend the principal you made without having to be employed. If I understand correctly, r>g is about how much of new wealth is coming to labor vs rent on existing capital.