[Thaumatology] Setting magic item prices to make economic sense

[Prince Charon]

One of the more common arguments about magic items is that some of the prices are too high to account for supply, demand, or perhaps both. Perhaps the income of an enchanter is not consistent with the prices of items, or it fits the prices just fine, but not the money that could otherwise be made with the sorts of skills that the enchanter needs to have (e.g. standard GURPS enchantment requires a presumably-rare talent, and multiple Hard skills at 15 or higher), so why become an enchanter at all (thus driving prices up due to greater rarity). Maybe the item existing at all save as a unique creation of a mad elf makes no sense because 'who would want to pay for that?!' (id est it's just not worth it in comparison to other things that the prospective buyer would wish to spend money on), when it's supposed to be relatively common, or at least not rare.

So, this thread, where we try to work out how to fit the prices of various magic items into a believable (which is not necessarily the same as 'realistic') economy. We may end up needing different threads for different magic systems, but this is just to get us started.

For our starting economy, let's assume a TL3^ fantasy world that looks kind of like Western Europe circa 1111 CE, and the standard magic system, with standard enchantment, from the Basic Set. I think it's safe to say that healing items are going to be worth at least as much as the costs given in the books, but even that I'm not totally sure about. What do you think?