You don't want to limit how much money people can make. That also stagnates the economy, although there is evidence that very high tax rates for extreme income (>$1M a year) don't adversely deter innovation.
The problem is thus:
You don't want very high tax rates because the government is aweful in general in getting people to want to better themselves. They use the money taken
You don't want enourmous inequality because amazing huge amounts of wealth, as you point out, becomes just a selling game to get more of it. Central banks then are forced to print more money, leading eventually to high inflation.
So, imo, one key is for government to own and promote infrastructure of any kind. For example, the government should own or at least compete with corporations for high speed internet access. It should cost almost nothing to get on the internet and have a high speed connection. Same thing with the interstate highway system. Mobility and access to information should cost almost nothing.
The problem with wealth creation is that it is misunderstood. People want to be rich which they equate with wealth, when what they should be aiming for is to be happy at their work. This bottom up approach works much better than just trying to create dull employment. As a government, if all you do is want to create jobs for corporations, you get a dull bunch of people that all they do is either: a) go to work and do nothing else, or b) are extremely poor. "Job" creation looks good on paper, but it leads to a dysfunctional society if the work is not suited to the person, which is the case in about 80% of the work force.
So, the question is, how do you encourage people to find their professional calling, and then, how do you create an economy that supports just about any conceivable job so that people can sustain themselves doing what they love.
That Monet, Mozart, etc died broke is the wrong answer. Having 3.5 BILLION people make $1 a day is the wrong answer.
