...Because so many hands are in the pot and so much is taxed. I made a generic rundown in a previous post, about how a promoter makes his money, but as a DJ there are many factors that determine your rates. It can range from dozens of reasons. Maybe they are the hot new shit and just want to strike while the iron is hot. You never know when you can fall off the map and many fans do not have a dedicated allegiance to these performers. Some producers only want to do this for a few years then invest their money or get a normal job. That means they gotta get as much as they can, as fast as they can.
Some performers have tons of expenses, like getting a work visa, paying their booking agent, paying their manager and some may not even have a normal job, since producing music is so time consuming, and maintaining a normal work schedule around a tour schedule is next to impossible. They sometimes have to pay to get their music mastered if their record label does not. Also, not many producers make enough money on record sales anymore since so many people download music illegally, so they compensate by having higher booking fees.
Also each region is different. Prices can be based on the local economy, the price of the admission ticket, if it is on a peak night like Friday or Saturday, how thriving the scene is in that region, or whether they are headlining or merely a supporting act. Prices can also reflect how big of a following they have on social media outlets such as Facebook, Twitter or Soundcloud. The number of releases they have and what popular magazines, radio shows or blogs they have been featured on plays a big role too. If they have collaboration tracks with big names, it increases their value as well. They may even pay for a publicist or promotional team to get them more popular. If a bigger name than them dropped a tune in a mix, they will most likely tell you about it so it increases their worth to the promoter. How popular their record label is plays an enormous role too.
If they have actual music training or went to a music engineering school of some sort, their rates may be higher because of their level of professionalism, the quality of their music, or they just need to pay off those loans. They have to buy all of the best gear to stay ahead of the curve. If they are from out of town, they obviously need to pay for flights and hotel which can sometimes be even more than the booking fee alone. They are also taxed on their earnings just like any other job. Sometimes they need to pay for studio space since you can get evicted from your apartment if you are playing/producing loud music all the time. They may have paid a professional photographer to do a photo shoot, or have a couple music videos produced, with thousands of Youtube views.
If they are a local DJ, and not playing an all original set, they are probably going to play at least 30 songs in their set, at an average of $2 each, which is another $60 they are paying for. Sometimes performers have set rates, and sometimes they will negotiate with you depending on what sort of relationship you have built. The agencies will always ask you to submit your offer because it is easier for them to milk as much money out of you as possible that way. Think about it, if you asked them what a certain DJs rates were, and they said $600, you may catch a break because you thought they were $2,000. But if you initially offer $2,000, that artist just had a massive increase in wages because you over estimated their potential rate. If you happened to low ball the agency with a $400 offer, they could easily respond and say their artists needs at least $600.