> If entrepreneurs can already do this, why the fuck are they paying so much money for engineers in the bay area?
Because these people are scarce and companies can't automate that type of job. Yet.
But, just look at what happened when Facebook decided to not pay SF salaries to those that moved out of the Bay Area. That was just Zuck saying "if you want be anywhere in the world to work here, then I can also look anywhere in the world to hire people", which instantly made them realize that they are not that scarce anymore.
> How would you measure your scarcity?
- My employer finds someone that can do my job for less money than I am asking, so they replace me. I am not as scarce as I thought.
- Some other company will offer more money to do the same job I am doing currently. I am more scarce than I thought.
- I work on new things, show experience or an ability that not everyone in the company can - let's say I am now able to manage a team of developers or I can work on both the backend and do devops. My scarcity increased.
> Because these people are scarce and companies can't automate that type of job. Yet.
But you say that if we paid by productivity then entrepreneurs would simply bypass those people. Whether that is possible is independent of how we determine compensation.
> It's not that hard.
You allow yourself to provide a very loose mechanism for roughly determining scarcity but demand a very precise mechanism for determining productivity in the previous post. This is an unfair comparison.
> But you say that if we paid by productivity then entrepreneurs would simply bypass those people.
No. Entrepreneurs will bypass them anyway, whenever possible and whenever profitable. The difference is that your idea of "paying by productivity" would make cheap labour expensive, consequently increasing the profitability of automating work process and accelerating the pace of replacing labour.
> You allow yourself to provide a very loose mechanism for roughly determining scarcity but demand a very precise mechanism for determining productivity in the previous post.
No, I am being descriptive of the current reality. You want to be normative about your idealistic method. So, yes, you have the onus of coming up with a system that could replace the existing one and be at least as effective.
Because these people are scarce and companies can't automate that type of job. Yet.
But, just look at what happened when Facebook decided to not pay SF salaries to those that moved out of the Bay Area. That was just Zuck saying "if you want be anywhere in the world to work here, then I can also look anywhere in the world to hire people", which instantly made them realize that they are not that scarce anymore.
> How would you measure your scarcity?
- My employer finds someone that can do my job for less money than I am asking, so they replace me. I am not as scarce as I thought.
- Some other company will offer more money to do the same job I am doing currently. I am more scarce than I thought.
- I work on new things, show experience or an ability that not everyone in the company can - let's say I am now able to manage a team of developers or I can work on both the backend and do devops. My scarcity increased.
It's not that hard.