Do I ever pay 1st price? Yes. It depends, however, on (a) what the item is, (b) how badly I would like to have it, and (c) if it is a "hot" or not. I don't make a practice of paying above fair value for something. I also do not make a practice of paying stupidly for something. But, if I do beleive that the seller has appropriately priced someting and I run the risk of losing the item if I bid below the asking price - I'll pay 1st price. I view things on a case by case basis.
Now, when I sell someting that's an entirely different matter. I will always advertise at a modest premium to fair value. First, it gives you room to work with a good buyer. And second, it acts as a filtering mechanism for all of the low-ballers and fickle buyers who say "my best friend payed $X - 25% for this same thing last week." Strong buyers make themselves known very quickly.
Now, when I sell someting that's an entirely different matter. I will always advertise at a modest premium to fair value. First, it gives you room to work with a good buyer. And second, it acts as a filtering mechanism for all of the low-ballers and fickle buyers who say "my best friend payed $X - 25% for this same thing last week." Strong buyers make themselves known very quickly.