At least for me, THIS. I vary my price depending on the workload itself and the time it will take, and I think it's the best way to price yourself.
Of course, you have to choose how much do you value such time, but when I see someone spending up to EIGHT hours to make a 10$ sprite... it's a little heart-breaking.
Artist and voice actor, trying to actually write stuff.
I think that much of the time the artist just doesn't know how much their art is worth or they just feel uncomfortable demanding more than 10 - 20 dollars a pop. I myself am fine with paying a high price for really good art, even knowing that I'll have to save up a while for it.
Honestly though, I don't really see how people charging low rates for their art has any impact on people charging higher rates - in my experience (which is meager, I admit) the artists charging higher rates tend to be the ones with the larger fan base and are getting more than enough commissions to be able to survive.
