> If you have a company and worker productivity goes up 200%, where does the product go?
In a mature industry, there is no new product, because all else equal, demand doesn't change. The company makes the same amount of product, but with fewer workers (aka layoffs).
Even in an industry serving growing demand, increase in worker productivity is not the cause of increase demand for product produced by that industry. Any growing enterprise knows it's first more important to focus on demand than increasing productivity, usually by hiring workers at the lowest cost possible. Otherwise, your competitor will serve your customers needs before you do. Premature optimization is a waste.
What increases demand for products is technological innovation plus a need/desire for more personal convenience, comfort, and time, coupled with the funds to purchase those in the hands of a growing population. Why have most companies have staked their future profits on the developing world's demand growth? Because the developing world has the desire for all of the above plus a growing population.
The question of where the new product goes has nothing to do with the question of worker productivity unless the workers have the funds to purchase those products. The product goes where the purchasing power is.
Capital's share of the return, however, goes into assets and as I described earlier, power. It doesn't go into purchasing any increase in product created.