The real question is - why there are so high? There are literally tens/hundreds of thousands of qualified candidates that Google rejects in their hiring process. This makes the remaining candidate pool small enough that they have to offer half a mill to get them. If Google's hiring wasn't so restrictive, they could pay much less. However, since they're basically printing money, there's no incentive to go there yet.
Google's internal culture sounds awful to me*. Tons of kool-aid chugging, shadowy political battles, people obsessed with tech for the sake of tech... plus they don't generally interview for a specific position, instead you interview for Google at large and then have to find a team that wants you once you pass the bar.
Passing the bar is also obnoxious. Maybe there are a lot of transcendent super-geniuses out there who can do it without studying, but IMO the Google bar is tuned to baseline-assume that you can crank out a Leetcode Hard problem in a few minutes, then they throw extra twists in on top of that.
So you have to spend months of your precious free time cranking away at coding practice just to get an offer, and then hope that you can find a job you like once you're in. OR you can go to Facebook, Amazon, Apple, Uber, etc and make just as much money.
* I can appreciate how it'd appeal to a lot of people though. One man's "Kool-aid chugging" is another's "Pursuit of social justice", one man's boondoggle is another's cool tech, one man's "shadowy political battles" are another's "Engineer-first Meritocracy"
Well, sure it is. The information asymmetry/individual motivation that you speak of doesn't make things somehow magically different, it merely helps determine, along with a myriad of other factors, the values for supply and demand.
> The real question is why are Google’s salaries so low?
Because that is where supply and demand meet, just as illustrated on the your econ 101 supply/demand curve. Quite simply, they don't have to pay more because supply is sufficient at that price to satisfy the demand.