My manager moans about this all the time. I also side with the candidate. If they get more money or prestige, good for them. What my manager refuses to do: Call them up and ask what it takes to stay? He knows what the answer will be most of the time: money or title. Then he moans about "over inflated expectations". Awful. I point out time and time again: If they are getting better from another place, then we need to pay better. If you think too high, then stop hiring in the location.