Actually failing game economies are as much about basic math as a direct result of social ineptitude.
The recycle-ability of things abroad, in-game or out-game is relatively the same. Massively people are used to doing whatever they are doing and leaving a humongous mess in their wake. These thought patterns directly go through designers making games. Where the world outside of games forces you to engage in a broken and heavily rigged economy just so you can obtain food, shelter and more. For a game and its economy you can simply walk away and spare your self the useless grind. You are at a grindy job with decreasing benefit any way, riding griffins in some game context isn't going to be awesome if you are subjected to the same economical torture you endure in your daily life.
Likewise overcompensating for this factor leads to absurd levels of inflation and abuse that quickly tears down any fun provided by the game environment. Not to mention technical issues resulting in exploits and such. And not even considering the hardest element of planning - efficiency variables - having an absolute best way to play the economy that usually renders most other gameplay activities useless, as players couldn't keep up with those "playing" efficiently.
The problems we are experiencing largely in the world today, play out numerously in games with economies. As they are built upon the same outdated and heavily faulty presumptions. except in games, the small scope and size of these projects reveals these flaws much faster than we get to comprehend them in the world we live in outside of games.
Overall most developers have economies for the same reasons a new car manufacturer puts tires on their cars. "Everybody else has them and the concept wouldn't work without them." However we all know the majority of manufacturers wouldn't go as far as to improve upon tires in any meaningful way or have any idea how to go about it even if they wanted to. That is IF their goals and budget have even considered tire improvements at all.
Why do economies fail? Because the people who make them lack the bare minimum of understanding. Its one thing to be in an economy as a participant. Its an entirely different thing to have the control over creating an economy and still fail in the end.
A lot of designers and devs I've spoken said to lack even basic projections for their economies. I know plenty who entirely "eyeball" their costs, times and so on. There are people who make large scale games and approach economy in a mystical fashion that, they can just set out and throw a bunch of whimsical random data that looks good on the eye and expect that it would "somehow" magically align to self-sustainability in the end. I also know people who do it on purpose. Here is a copy paste conversation from one of them I talked to just the other day:
"My boss wants me to design every feature, help with QA, babysit CMs more or less manage the coders, if he think I'm going to do the work of an expert mathematician and integrate it into the game in a way that makes sense, someone is gravely mistaken and its not me. I've insisted that either the scope is scaled back to fit what we can do, or more is invested to do it properly. Both were rejected, because the decision makers care more about appearing authoritative than actually understanding what is happening in their project. So congratulations, keep the payroll flowing and ask me create a new txt file type some random stuff in and then delete it, I'll repeat 24/7 if you insist - I don't care any more. When i go looking for a new job, it will be fine, I strictly followed my tasks, integrated with co-workers well, met my deadlines good enough, if anybody asks i sure as hell didn't make the economy, in fact i have an old email proving I have foreseen most of the problmes, not my problem that management ignored it. You know they never believe you when you say you didn't have enough to work with, considering we are in the crunch time industry, which is supreme at dehumanizing people with passion and potential about making games. Why do you think some of those cool profitable indies made it solo. Most of them begged companies to look at them and throw them a used bone, except corp scale devs could have bought them for pennies but instead threw em out flat on their ass because they are utterly incompetent at recognizing potential. They wouldn't even ship out their own games in a playable manner what do you expect?"