The same reason why people care about likes on Facebook or karma on HN.
Internet points mean very little, until you get enough that you start floating to the top of popularity rankings, at which point they suddenly become indirectly monetizable.
Stars have some value in they at least let you see that (the potential for funny business aside) many people have looked at the repo and upvoted it for whatever reason. I'm sure there are buggy or otherwise sketchy repos with many stars, and various gems with few stars (I have some :p ), though overall it's a signal
Incidentally karma on HN is similar to the extent that it lets you how active a participant someone is, and that they're not a troll or throwaway. Again, it can certainly be gamed, and throwaway accounts often add valuable comments, but its still a signal
I’ve been contacted more than once by recruiters who’ve been attracted by stars of my profile. It’s always a little challenging to explain to them that my profile is just my hobbies.
Because people have hobbies and wish other people are enjoying them. Or it does help people tell if code is helpful if more people are using it. Or its some guy with 8,800 throw away android phones.
