There's really a rather comical effect behind raising prices on games: it encourages more piracy, due to the supply and demand equation resulting in a lower equilibrium point. Only a handful of companies seem to have caught on that their real enemy is themselves, not the consumer. And the more they try to fight piracy and alienate customers, lowering customers' acceptable prices for things while ironically raising the actual prices further, the more piracy will increase. It's really simple economics going on here, the market doing what it's always done, but the industry seems to have gotten the mistaken impression that they are above normal market mechanics.
If the industry wishes to curb piracy, they need to make products which people will buy. This means more than just compelling content; it's also having a compelling price. If that means lowering the budgets for making games, so be it. Quality is not a measure of how much you invest, but rather of how much you get out of your investment and how well that output is accepted by the mass of consumers willing to pay for it. I can think of no finer examples than Wii Sports and Shenmue as illustrations of getting it right and getting it wrong. Wii Sports cost very little to develop, but is a genuine system-selling title that the mass of consumers finds instantly appealing. Shenmue, by contrast, cost an excessive amount to make (reportedly, every DreamCast owner on the planet would have had to have bought 3 copies of the game for it to break even), and it had niche appeal at best.
I know the industry goes on and on about "art", but really, that's an excuse. You cannot "make art". "Art" is not a job in and of itself, it's a side-effect of doing an actual job well. What is and is not "art" is decided after the fact, and all you can do is create something and present it for assessment. The job of a game is not to be "art", the job of a game is to entertain the player.