Price matching and undercutting are done all the time in real market economics. A *lot* of companies thrive on advertising having the lowest prices. And they don't do that without undercutting most of their competition.

So it's not a hideous, horrible thing: It's just the way economics works.

I generally undercut because I'm not interested in playing an economics simulation - I'm only interested in selling off the stuff I can't use. Undercutting means I sell stuff faster.

If you care to be a reseller and buy and resell my items - go ahead, I could care less. Resellers are also common in real life. I get a profit either way.

"In real life, anyone who does this will go out of business. In WoW, no-one who engages in this senseless market destruction goes out of business because they place no value on their game time and consequently have no overheads and any sale they make they consider to be profit."

It's also this way because:

-There's no concept of debt in WoW. None at all. Either you have enough gold to buy something, or you don't. There's no risk at all of owing anybody a debt.

-Gold is granted to players by means other than market economics. Mobs drop gold, quests give gold, dungeons reward gold, etc. You're not just competing against other people in the AH - you're actually competing with the game world, which is supplying players with an endless stream of cash. If it weren't for large money sinks in the game, the currency would inflate like crazy.

Economics in WoW has very little risk. You can't go into debt, and you can't really go bankrupt because there are so many sources of money.

Going penniless in real life is a major concern - but going penniless in WoW is just a minor annoyance. In real life, it may take months to find a job, but in WoW, you can just kill a few mobs or mine some ore or whatever, and you'll have money in minutes.