Every good or service has a fair price.
The fair price for labor depends on skill. Unskilled labor isn't worth as much. Maybe it's only worth minimum wage, or maybe it's worth like $15 an hour. More skilled labor is worth more - $20, $50, $100 or more an hour.
The fair price for a product is the cost of the parts involved plus the cost of the labor, and then maybe a bit extra to cover overhead or something. So if a chair costs $500 in parts and $500 in labor, the fair price for that chair is somewhere around $1000, maybe a bit more.
I think the above sounds pretty reasonable to most people.
The problem is, it's nonsense.
There is no "fair" price. There's just the market price - the price people are willing to pay. If you try to sell below the market price, your inventory will be snapped up right away and you'll be forced to raise prices. If you try to sell above the market price, nobody will buy, regardless of how much effort and material you put into the thing. You'll have no choice but to lower your prices.
What is true is that in a liquid market with lots of competition, we expect the market price to converge with the "fair" price. If it's easy to make money on something, then more people will enter the market and bring the price down until it stops being worth it. If nobody is making any money, people will drop out of the market and the price will go up until things settle down.
But this only happens because people respond to price movements. It isn't automatic or instantaneous. So at any given moment, most prices will not match the "fair" price in one direction or the other.
This is particularly true if there is a shock to either demand or supply. If there's a new TikTok craze for scented candles, the demand may outstrip the supply. Either the price for candles will go up or there will be shortages. People who happen to have candles in their inventory will get a windfall from this. Manufacturers of scented candles will also enjoy windfall profits for a bit until production scales up to meet the new demand and stabilize prices.
The above is just how it works. If you freeze prices, the result won't be that everyone will be able to buy candles. There will just be mass candle shortages as the limited supply gobbled up. You can theoretically attempt to ration out the candles at a lower price, but this is complicated to administrate with unclear benefits.
I think a lot of people use a "fair price" model in their head when thinking about prices. The "fair price" model is therefore a folk theory of economics. Not scientific at all, but widespread and popular nonetheless. But if this is the main way you think about pricing, you will always be confused and upset about prices. Every movement in prices will seem like an attempt to rip you off rather than the inevitable result of market logic.
The other more subtle failure of "fair price" theory is that it inverts the creation of value. It pretends that the value of a thing is dependent on the effort and materials that go into the thing. But this is backwards - the value of a thing depends on how much other people want it. If you are able to make the same item with fewer hours of work and less expensive materials, that is a good thing.
People often think that because they put a lot of work into something, it must be valuable. But that isn't how things work. It's thinking backwards - what you ought to do is figure out what people need and find the easiest way to answer that need. Value is created by our desires and preferences, not by our labor.
The same can go for skills. People often complain that, because a job requires some special qualification, it ought to be paid more. But pay isn't determined by your "skill." Your pay is determined by how much actual useful stuff you do. It's true that qualifications in high-demand often command a premium. But it's not because those people worked really hard. It's because those skills are *genuinely useful* and *rare*. If there are more people who know how to do a thing than there is a need for the thing to be done, then the thing will never command a high salary regardless of how "difficult" or "skilled" it is.
I think a tremendous amount of angst comes from the disconnect between "fair price" theory and actual market prices. It feels unfair when a price shoots sky high because of a demand shock. It feels unfair when one person makes twice the money for the same amount of work. But the alternative always creates perverse incentives - encouraging people to pour effort into things nobody asked for or deploy scarce resources towards things nobody really wants.