If you feel you are treated better elsewhere, as a manager I'd help you transition to that elsewhere. If that is what you really want and think is best for you, I would make it as easy for you as possible. If you think money is most important to your current situation (house, wife, kids, debt, ...) and you're skill set is beyond my budget, than this is fine with me.
I'm more interested in people-relationships than job-relationships as I have met many of my employees in other companies and we're still friends - and most of them left for a different job with probably more money. Some of them told me years later they should not have left because I usually invest a lot into people development and money is only one parameter to job satisfaction.
I'm pretty sure you're an exception.
The BATNA for the employer is training a new person who isn't going to make every 6-12 months a fight.
Suggesting that it's fine for the employee to exercise their BATNA, but that it's not OK for the employer to exercise theirs seems a bit odd.
what, they'll find a better and better job every six months?
From the commenter above, make your employer fight for you every 6-12 months.. A lot of people hate stack ranking ("making your employee fight for their job every 6-12 months"), so why do people think that companies will want to be in the reverse position.
how they'd be paid better somewhere else, deal with it. Denial gets you nowhere.
The above poster said, "wished the employee all the best with his new job.", which is dealing with it, and not denying it. It's a win/win for everyone. The employee gets a new position with presumably higher pay, and the employer gets a chance to hire someone who isn't going to make them "fight for you every 6-12 months".
So if an employee you have hired is able to get a competing offer every 6-12 months, it is worth spending time to figure why things are so screwed up in the company and resolve that.
Once or twice I can understand. Pay isn't always calibrated correctly, weird stuff happens due to company/employee history, whatever. But if your employee is consistently able to get higher offers once or twice a year then something must be screwed up.
#2 especially - what, they'll find a better and better job every six months? Not likely. If somebody can show you how they'd be paid better somewhere else, deal with it. Denial gets you nowhere.
#3 is exactly what the above remark addresses. If I can show my boss I'd be treated properly elsewhere, the boss sure better get on board and start doing those things.