A little bit of both, if you're only talking about gathered items. Some folks just need (or want) a quick buck, so they make their item the hands-down best deal. Others just want to crash the market for said item, to their benefit.

If you're talking crafted items, there's many more variables that come into play. You have to think about how much money you're either wasting (if you gathered them yourself) or spending (if you're buying off the mb) to create your item. Then you need to settle on a sale price that is reasonable. Then, based on all of the above, you need to make sure you're still making a profit after the mb tax/all purchases and costs of materials. Some people don't care about all of that, because they're rich. They have disposable gil they can use to crash your market, buy out the remainder of it, and then sell it back at a profit.

It's ruthless economics. Ran by psychopathic gamers.