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SF plumbers only get paid a lot because SF engineers can afford it. Tech companies only pay SF engineers a lot because they can afford it. That entire distribut
by remedialhedge 6y ago
SF plumbers only get paid a lot because SF engineers can afford it. Tech companies only pay SF engineers a lot because they can afford it. That entire distributional outcome comes from the top: tech companies make absolutely embarrassing amounts of money, and engineers have (for now) enough bargaining power to get some of it for themselves.
Or as a counterexample, there are plenty of industries that do not exist in SF because they don't have large enough profit margins to support it. There are no factories in SF. CoL comes from the high salaries, which comes from the high profits. Not the other way around.
- mettamage 6y agoHere here! The more companies I see, the more I experience this as true.
- ClumsyPilot 6y agoAnd half that money is being captured in the totally un-productive real-estate market that adds nothing to the real economy.
- ForHackernews 6y agostill better than adtech. At least you get a crummy apartment to live in.
- sudosysgen 6y agoIt's even worse than adtech. Construction is a small part of the money that gets siphoned away by housing.
- yourapostasy 6y agoI've long maintained to those defending high real estate-dirt pricing to show me how such pricing creates a smartphone industry, cancer treatments, disease lab tests, and more currently, mRNA vaccines, versus letting 100,000 smart people coalesce into the same physical proximity without worrying about shelter costs (in the US, they would also have to not worry about medical bankruptcy). In an age where economic advantage accrues to those with the greatest cognitive capacity to throw around, instead of land, the first nation to commoditize the complement of the cost of land and the utilities underneath it, and shift all that trapped capital into developing many vibrant, dense Shenzen-like communities, will vault over the other nations. I don't have a dog in that hunt. I have my land on a somewhat sane cost basis. My interest is academic.