Oh, don't get me wrong, I have worked on interesting things with entrepreneurs, without pay, for months at a time. Or even asked for a certain amount, and then never took any money. And I have also worked on interesting problems for far less than what even a mid-level engineer could earn at a decent company.
It isn't always about the pay, but it is often about weeding out the people who would take advantage. There is cheap, and there is poor, and for some parts of my career I have confused the two.
Much like I won't pay for something just because it is expensive, but I will often pay for the more expensive option rather than the cheaper one. Expensive doesn't always mean good, but it is a differentiator and a signalling mechanism.
I use compensation as a litmus test to determine if someone is trying to take advantage of me. If the company is trying to low-ball me, that means to me, not that they are financially cheap (though some are, and you can smell them from as far away as the dog's dinner from two nights ago), but that they believe me to be naive and exploitable. I might be an immigrant, but it doesn't mean that I stepped off the boat yesterday.
Out of all the benefits and bonuses and culture that a company has, all of which can be taken away or changed in an eye blink (Activision's purchase of Blizzard for instance) for a variety of reasons, base compensation is exceptionally hard to hand wave away. Companies that don't pay well usually have crap culture, lousy benefits and work-life balance that truly sucks. Again, for me, compensation is a signalling mechanism.
