Alright so I’m going to take a stab at this question.
As mentioned in a different thread, the drop rates were carefully tuned for a single player playing through from 1 to 60 without ever using the AH.
All of our items are randomly generated, and so follow a distribution curve in power. Let’s say for the sake of argument that you were to somehow distill an item down to it’s “power level” and created a distribution graph of drop rate vs. power level. This graph would probably be normally distributed with outliers at high power levels dropping at a lower rate.
Looking at this graph, an average item drops every 5 minutes, a higher power item drops every 15 minutes, even higher power drops every hour. etc. As you move up the curve to ever more powerful items, the amount of time it takes to find such an item increases. This is what makes certain items more desirable, this is how things worked in D2.
What happens for a standard player who is playing solo when they first hit level 60 is they see an item upgrade every 30 minutes or so. Pretty quickly it becomes every hour, then every 2 hours. The higher the power level of your gear, the longer it takes to find your next upgrade, that’s just the underlying math of this distribution. It’s not really anything we set either. If we magically made all drops rates 10x higher, all it would do is shift the power curve left or right, it would not change the fundamental property that the higher up in power you go, the longer (statistically) it is going to take until you find your next drop.
So then let’s say you visit the Auction House and get infusion of power that hurls you forward on that power curve. So whereas at one point your gear may be at a point that you are statistically speaking probably going to get an upgrade every 2 hours. After visiting the Auction House you hurl yourself forward on the power curve so far that now you are statistically going to get a drop every 8 hours.
To further illustrate the point, let’s talk about the coming changes in 1.0.3. In 1.0.3 we’re going to start dropping level 63 items in Act I of Inferno. We’re also reducing incoming damage. What do I expect to happen? I expect that there will be a rapid increase in power across the entire community as all of these items become more widely accessible. It’s like we took the distribution curve of items and made everything drop more. That item that used to take 10 hours to find is now a 2 hour item. An item that used to be a 2 day item is now an 8 hour item. After the initial frenzy of power increase, things are just going to settle again. People who think drop rates are too low now will probably still think drop rates are too low a week later when they move to the new point on the curve. I’ve spent a long time on this question so I’m going to move on but hopefully somebody who gets what I’m saying will be able to expand on it more, maybe draw some graphs to better illustrate the point.
tl;dr we could make drops 100x what they are now and it would just cause everybody to settle at a new equilibrium point. Anything you can farm in a few hours you’ll already have, anything that takes longer you’ll wish you could get faster.
onfirms / 1.0.3 Additional Information:
• ‘Shielding’ affix is being nerfed: Monster’s with this will cast the shield less often.
• ‘Invulnerable Minions’ affix is being changed: Vulnerable Champion will now have less life and be easier to kill.
• Mobs that flee will do so less often, including blue/yellow packs of fleeing Monsters.
• Confirmed: Blacksmithing costs too will be reduced in 1.0.3.
• Auctions may now be canceled at any time.
• Componets of the Staff of Herding will stand out much more in the player’s inventory.
• Players have discovered every zone in the game (aka there’s no unfound hidden level).
• Confirmed: Holy, Fire, Cold, etc are purely aesthetic, with the exception of Cold, which does slow mobs but has reduced damage.
• Confirmed: Whimsyshire drops ACT III/IV loot even after the 1.0.3 changes.
Coming in a future patch:
• Custom chat channels.
• Leaving a chat channel saves between joining and leaving game sessions.
• Class changes and diversity (Trying for buffing underused skills/runes rather than nerfing good ones).
• First time boss kills on difficulties higher then Normal will guarantee “first time loot”.
• ‘Lock Action Bar’ toggle is being added.
• Gems, Health Potions and and Pages/Tomes may be changing in color to help them stand out.
• Ability to Turn off the nameplates for white/grey items on the ground for high level characters.
Possibly future stuff (not confirmed):
• +Health to healthglobe items to increase health received from Potions.
• Ability to see DPS/health changes much like in-game, also in the AH window.
• There may be dueling implemented at some point.
• Invisible mode for battle.net status.
• Auto-Skip switch for in-game cutscenes.
• More “on hit” procs, specifically on legendaries to make them feel more, Legendary, with a higher proc %.
• Adding gems to blacksmithing to “force” a stat on crafted gear.