I think this is a bit oversimplified. Another perspective is that your skills are worth X to the company, and when they felt constrained to hire in the SF mark

I think this is a bit oversimplified. Another perspective is that your skills are worth X to the company, and when they felt constrained to hire in the SF market, they found they had to increase pay by Y. So your resulting salary of X+Y might be artificial. Also, moving to a different timezone/non-local presence might actually diminish your value to the company. It might even cost them money, though usually a small amount. So your new rate might reasonably be X-Z. Regardless, when you turn yourself into a different product, your value to the buyer changes, and is reevaluated in the context of competing products. Relocating is just a qualifying event for triggering that reevaluation.