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Buyers are free to choose to buy from the company in Poducksville instead, but I suspect that, in the typical case, they'll never learn about said company becau

• lenerdenator 2y ago
  Every ecosystem - economic, ecological, or otherwise - has a carrying capacity. The SV/NorCal area is reaching that capacity. There are only so many dollars customers are willing to pay to get a quality product, service, or charitable act before the law of diminishing returns kicks in, and those dollars are what funds the compensation packages of both profits and non-profits. There is no infinite well of value (no matter what capitalism says), which means that there is a ceiling on things like salary and the things (namely residential real estate) that said salary can buy. If you pay a person $300k to do a job because that's what the local job market dictates in SV, are you really getting the surplus value to cover that salary? Can you keep charging customers that amount? Will you do increasingly alienating things that causes negative externalities (read: regulation) to be passed that impact your business model's ability to pay that much? You could very well be better off to hire someone at the $150k rate in a place like Kansas City or Minneapolis. Those aren't "Poducksville" but that's the competition the valley will begin to see.