When discussing Diablo III on Monday, there were some interesting comments from Gevlon, who believed that the AH economy will be driven by people buying items so that they can play through Diablo III at a higher difficulty level. Quote: "However there will be significant social pressure on the player to keep "progressing" on higher difficulties, and don't be a "noob" who just did it in normal." Now I can see how somebody observing MMORPGs could come to such a point of view. The social pressures to progress to higher difficulties in the form of raiding and not be a noob without epics most certainly exist. But I am not sure that these social pressures are ultimately the reason why people play beyond a difficulty point with which they are totally comfortable. And thus I don't believe the same forces will work in Diablo III.
What I consider the key difference between let's say Diablo III and World of Warcraft is the nature of the harder difficulty content. In World of Warcraft the harder difficulty content is an additional and very different game, the raiding endgame. In Diablo III the harder difficulty consists of playing through exactly the same content a second time with the mobs being tougher. That does not hold the same attraction.
In short, I believe that average players let themselves get dragged into raiding even if they aren't very good at it or enjoy it very much not because they are offered shiny epics, but because they are offered new, and very different content. It isn't as if WoW is offering all that many alternatives at the level cap if you don't want to go down the heroics / raiding route. In Diablo III the *only* thing you can do once you reached the end, is to start over. You only get the choice whether you want to start over at the same difficulty level or at a higher difficulty level. Thus I believe that most average players might *try* higher difficulty levels, but those who don't really enjoy them will rather opt for normal difficulty than going down a path of paying real money for legendary gear from the auction house just to be able to do the same content at a higher difficulty level.