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People perspective:
Different people have different priorities.
For people who value money (salary) more than position/title, they wouldn't mind taking up a job title lower.This kind of behavior is predominantly visible among employees in entry to mid-level career.
I know people who value designation more than salary, it is a sense of entitlement for them. They may be skeptical of moving to a perceived lower designation.
Organization Perspective:
Moreover, organizations follow different nomenclature in designing designations. Some organizations use it as a strategy to lure potential candidates. eg. Banks. Entry level title could be Director or AVP.
My perspective:
It all boils down to a combination of role and salary. There is a tool designed by Mercer called IPE( International Position Evaluation). It helps to compare job roles between organizations and pitch the right salary for the candidate accordingly. eg. An AVP in org X may be performing the same role( refer Job descripttion) as a Manager in org Y. Doesn' t mean the Acquisition team of org Y will hire the person from org X as a AVP. They will hire him/her only as a Manager.
I think it is not good idea to do that because work not always about money
