For the avoidance of doubt, "Market Inefficiency", in this instance, means the inefficiency of the Market code in processing orders.
Does the slow processing of players' orders cause prices to spiral? I think so. Oftentimes I see prices rise and rise as impatient people outbid one another because the processing is slow.
What on earth is going on? The market code seems... considerably sub-optimal. Why do we see weird shifts where suddenly the price of yellow salvage goes to relatively high levels of influence each for weeks on end.
I believe there should be an OPTION, when setting price, to have the asking price decrease over time. This would allow old orders to eventually fill. It's an alternative to having the offer expire after a time period. Look at how much Yellow salvage exists on the AH. At the time of writing 10,021,032 for sale. And yet the price is quite high. It's a failure.