I think the primary culprit is compressed development time.
"Before", games would take minimum 2 years in development before they were released to the public at "full retail" (which was $40-$50). Lower end titles/shorter development cycles were budget titles in the $20-$30.
With the likes of EA, a lot of games are now on a 1 year development cycle. As if that wasn't bad enough, there is so much time pressure that games are often released unfinished. To the business whigs, that is achieving a higher margin, i.e., minimizing development costs by still getting that $50-$60 per license. They achieve higher margin: in the limit where development was free, these companies are essentially printing money. Best recent example is Dragon Age 1 and 2. It's as new games are all on a "Madden cycle," where minimal development justifies like-new pricing every year.
In any case, there are still a few developer/publisher houses that don't follow this model, Blizzard side of Blizzard-Acti being one of them. The $60 I paid for SC2 was worth it, given the amount of enjoyment I derived out of it. On the other hand, another title I recently bought, F1 2010, I feel like should've been a $30 launch title.
But people are still buying "bad" games a these $50-$60 prices, so they can still charge those prices.