You're saying academic prestige is a Veblen good, like a handbag?
Are you sure?
Are you sure?
If you graduate from an Ivy League college (or publish in a prestigious journal) others view that as a signal of your qualifications and that can open up careers that require that the box be checked.
As such, people are willing to pay a lot of money to go to an Ivy League college (or publish in Nature). And the "system" has a vested interest in keeping that gateway in place, because the people that passed that gateway years before you, don't want to see it go away as it would reduce their own status.
It's not exactly the same as Veblen goods because what the academic institution is paying for is access to journals. But they need to pay for these expensive journals because they're prestigious, and they need the prestige to decide who gets the money/job, and the prestigious journals know this so they mark up the price.
If prestige wasn't what they were paying for, law of supply and demand (and healthy competition - there are many competitors in the market) would make the price dirt cheap. But it's the opposite.
The problem we authors have is that nobody who has the knowledge has time to start a publishing business (and it's way less rewarding than science itself), and in the end we don't pay for publishing, but the grant (i.e. all of you) do. We authors are funneling money from the tax payer to publishers like Elsevier without asking questions, because all of our incentives are publish on the highest IF you could get, or leave academy. Also, in the hypothetical that somebody started a promising cheap journal, they would get an irresistible offer from Elsevier, Thompson, MDPI or Springer and that would be the end of it.
I've been in talks were people tells you "publish at whatever IF you want, if your research is good, people will notice". Yet, each and every time you apply to anything, they value the IF. If your paper has been cited by 7,000 Q1 papers, but was published in a Q4 journal, it worths much, much less than a paper published in Q1 journal cited by no one. The value of your paper is not made by association, but by a flawed metric that values mainly the journal.
But make no mistake: as an author I don't have to care how much a journal charges to publish, because I will get the money from you. All I care is the journal is a Q1. At Q1 level it's an oligopoly, they all charge about the same, and grants already includes the money to publish, so I don't need to compare prices. My monthly wage will be the same and my CV will get better. The publishers know this, and they prey on you... through me.
What about university presses?