In your example, the demand for cabs would decline. People would find other modes of transportation or not travel at all. You are right that an engineer's pay

In your example, the demand for cabs would decline. People would find other modes of transportation or not travel at all. You are right that an engineer's pay can only go so high. However, when the rate exceeds what you can afford, you simply bow out and do something different. Hire someone who does not have talent or refrain from doing the work. Ferraris exceed what I am willing to pay for an automobile, but you won't hear me complaining that there is a shortage of Ferraris. Instead, I will buy a lesser car (an unskilled worker) and make do, or forego car ownership altogether. A shortage implies that all the money in the world can still not allow you to fulfill your needs. If the fulfillment is out there, but you are not willing to pay the prices, that is not a shortage.