I agree with you. Longer listing times will lead to lower prices. If 10 people all have "item X" and sell it on the GTN they have to be competitive for a sale. However, if 9 of them do not play for say, 4 days in the current system with a 2 day listing, "item x" falls off the market and 1 person has the monopoly on item X and may sell it for a very high price.
A longer list time also allows for an improved market. I would craft mods and enhancements for the lower levels and I have a friend who did that for a while too, but there isn't a need for a level 15 mod every two days. Item listings expiring every two days makes it too much work to keep mods available to players, so we don't do it anymore.