And yet that cost goes down when employers don’t pay for your office space…

And my cost goes up when I pay for my own office space.

But you don't have a commute and can do stuff at home during work.

So? That doesn't net me money during salary negotiation.

If it means that some actually-a-dog2 realizes that they prefer it enough to work for 5% less, then you need to compete with that.

Let's say you get paid $100/hr for 8 hours per day of work, or $800/day. Now let's say you have to commute an hour round trip to and from work. Since you need to commute to get paid, it takes you 9 hours to earn that $800. Thus your real hourly wage is $88.89/hr. The person who doesn't need to commute works no harder, but it only takes them 8 hours to earn the same wage. They effectively have an 11% higher wage than the commuter, all else being equal. They could work for $95/hr, making them the more attractive option for the employer, while still being better off than the commuter.

> This is a common but fundamental misunderstanding of what determines your salary. Your salary is determined by the market...

Location based adjustments are replacing this misunderstanding with a different misunderstanding which is roughly "The market rate for the position is determined by where *the employee* lives, not by the many others elsewhere that would be qualified by the job"