>>Economic activity is generated by the act of expenditure.
The tendency toward expending money for products is not a scarce economic resource. It is always abundant, and leads to almost everything produced being consumed, as it reaches its market clearing price.
What's scarce is capital and production, and only the profit-motivated investment that emerges when people are secure in their right to their private property has been shown to rapidly make it less scarce. Witness China before and after its market reforms.
The facet I'm viewing economic activity from is the magnitude, distribution, and probability of expenditure based on the differential between an individual's cost of living and luxury purchases.
The aggregation of wealth in a subset of individuals, with respect to the cost of living, will leave them more free or willing to make nonessential purchases which generate an expansion in economic activity. I'm getting at the point that distributing those liquid assets across more individuals will lead to an increase in the magnitude, distribution, and frequency of aggregate economic expenditure (i.e. monetary velocity). It's tricky because, as you referenced, there are markets for fixed resources which could be negatively impacted if that debt to income ratio gets too large for the majority of market participants. Although I think the trajectory of consumer markets further favors my view point as purchases are transitioning from physical goods to services and digital goods.
In that same vein, I believe profit-motivated investment is only reinforced by a greater diffusion of economic expenditure. The diffusion only increases the frequency of opportunity available for firms to enter an arbitrary market.
The tendency toward expending money for products is not a scarce economic resource. It is always abundant, and leads to almost everything produced being consumed, as it reaches its market clearing price.
What's scarce is capital and production, and only the profit-motivated investment that emerges when people are secure in their right to their private property has been shown to rapidly make it less scarce. Witness China before and after its market reforms.