[sokoloff]

…unless the value created via prompt engineering is high enough to cause companies to rationally demand even more prompt engineers.

The size of the pie is nowhere near fixed, IMO. There are many things which would be valuable to program/automate, but are simply unaffordable to address with traditional software engineering at the current cost per unit of functionality.

If AI can create a significant increase in productivity, I can see a path to AI-powered programming being just as valuable as (and a lot less tedious than) today.

[somenameforme]

Again it's not about value, but solely supply vs demand. If there was somehow only one person who could do janitorial work in a city, that'd be one rich janitor.

For a more realistic example - the software side at many companies essentially is the company. They bring products all the way from inception to launch. Yet they tend to get paid less, often much less, than the legal side. The reason is simply that the labor pool for lawyers is much smaller than for software engineers.

If there's not significant barriers to entry for prompt engineering, wages will naturally be low.

[sokoloff]

Demand incorporates/expresses value (fairly obviously).

[somenameforme]

Only if one uses circular logic when defining it, which is I find the MBA style definition of value to be mostly meaningless and also misleading, because people interpret it as they want. By contrast directly speaking of supply/demand encompasses everything quite well and eliminates any circular logic, let alone the need for such.

[sokoloff]

How would the demand curve avoid expressing anything the value the buyer receives (or at least perceives) from their transaction?

[somenameforme]

It doesn't. It simply makes clear that the reason is not 'value', as somebody might interpret it, but scarcity. If there were 100 million competent software engineers in the US, the value they add to companies wouldn't change, but their labor costs would - quite dramatically. In such a scenario coding and flipping burgers would offer relatively comparable wages.

Supply:demand makes the reason for this change completely clear, vague notions of poorly (and often circularly) defined 'value' do not.

[sokoloff]

Scarcity is reflected in the supply curve.

Value in the demand curve.

Where they intersect gives the market price.