According to this logic, our developer has actually earned his wages in perpetuity from this single year of work (or at least so long as that 15% value added lasts). But that's clearly not how it works either.
The issue in this example is ownership. Executives add value and they are granted large ownership stakes in the business. Workers are not. You use the example of the executive who figures out how to grow the business to prove that he is entitled to appropriate some of the other employees' added value -- since otherwise that value wouldn't exist in the first place. But our developer can't take his yearly salary out of the 15% increased revenue he enabled back in 2012, on top of compensation for whatever value he creates this year.
In any event, the example is very contrived. $10M in sales is as arbitrary as 20% profit margins. Margins could be any amount less or a great deal more. Revenues could be sky high or non-existent. You might expect to find a developer making $100k regardless.
The issue in this example is ownership. Executives add value and they are granted large ownership stakes in the business. Workers are not. You use the example of the executive who figures out how to grow the business to prove that he is entitled to appropriate some of the other employees' added value -- since otherwise that value wouldn't exist in the first place. But our developer can't take his yearly salary out of the 15% increased revenue he enabled back in 2012, on top of compensation for whatever value he creates this year.
In any event, the example is very contrived. $10M in sales is as arbitrary as 20% profit margins. Margins could be any amount less or a great deal more. Revenues could be sky high or non-existent. You might expect to find a developer making $100k regardless.