Comment by kannanvijayan

I think your example hinges more on the fact that $10/hr is a desperation wage. It's not enough to buy you a life where you're not stepped on by others. The further up that chain you move the more other things start to matter, at least for most people.

If you're offering me $300/hr and the other guy is offering me $400/hr, a whole lot of things start to matter more than the differential.

That gets at the "fungibility" notion you refer to. Money has the same nominal value everywhere, but different real value based on how much of it you already have. Which is to say that the marginal value of money drops pretty precipitously several times at certain thresholds that relate to the particulars of the economy (when you can afford to eat, when you can afford a house, when you can afford to not work anymore, and so on).