Person A is not seeking a profit on two separate synths though. That's what you are overlooking.
Person A is not taking his Pterodactyls and seeing what profit he can get for making Pterodactyl Straps. He is taking his Pterodactyls, making the P Straps, then turning that into an Adamantite Francesca.
Person B is buying someone else's P Straps and trying to use the sale of the Adamantite Francesca to cover the cost of the P Leather, other materials for the Francesca, and make whatever profit he can. If Person B is lucky, he can find someone (Person C, or perhaps get in touch with Person A) willing to turn his Pterodactyls into P Straps for him, at a lower cost than the P Strap fetches on the Board, but it still increases his overhead. (Yes, I know, Pterodactyl Straps are not Specialist-Only anymore. They still get the point across.)
And the person hurt most by all of this is not A, B, or C - it is the BUYER. Persons A and B are trying to sell for the highest they can, while still actually selling their products. Lacking the need to pay off Person C, Person A can sell for less than Person B, often to the point that Person B cannot even make any profit. Person A is still able to make a profit, however, because he's not depending upon someone else to provide materials for him.
The Specailization system prevents other people from intruding into the markets that A, B, and C are operating in, however, for they lack the requisite Specializations. That minimizes the competition, the need, to reduce the prices they are putting them up for. This ends up hurting the market, by reducing the number of sales (fewer can, or want to, pay), thereby reducing the total profit the crafters are able to generate, which reduces the amount they can craft to put up for sale, in a vicious cycle.
The rampant undercutting was a result of too much supply, not enough demand, for any given item. The Specialization system does nothing at all to address the demand - it only cuts sharply into the supply. Specialist-only recipes are, and have been, bad for the market as a whole, regardless of how well a few individuals have been able to use the Specialization-Only recipes to take Gil from others and line their pockets with it.



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