Sometimes not, but sometimes they are. Sometimes thinking you have no other choice allows others to convince you that giving them your work for free makes good business sense when it very rarely does. Sometimes desperation just to have your work out there, makes someone undervalue what they've created.
Sometimes you are young and naive and hopeful.
Sometimes people take advantage of that.
I disagree. You ALWAYS have the option to google a prospective client's name and reputation. If Google tells you that person is a Nobody or an Aspiring Somebody at best, that's your cue to make an informed decision. The same option is available for rates and royalties. You know what you're studying, so you know what to look for.
Plus, students aren't getting paid for assignments either. And school will use those assignments in exhibitions and promotional material the student isn't getting anything out of. But refusing to do those assignments that will lure new paying students, will get them a fail grade. As if anyone of importance would ever go to a school exhibition, see your work there, and make you huge. Every day you're in art school, you're being exploited - you're paying to boost the school's name and may still fail to get at least a degree out of it.
And how can they think they got no choice when they're not even holding their diploma yet? When they haven't opened their own business and failing to pay bills? Every person has the option of asking questions. If they fail to do so, they're not being exploited, they're failing themselves. They can just not take commissions like so many other perfectly happy students. Or they can set their own terms and enforce them. Choice.
I've done a book illustration job for a guy who sounds like he could afford to pay me way more than we agreed (an amount I offered for fear he might look for someone else). He's also going to publish the book, though I don't know through what route yet. Looking at similar art commissionable through deviantART members, I know I'm being a heaux.
But am I being exploited? No. I decided this project sounds fun (and it is!), could be a good route to exposure, so let's not scare him away with the rates I'd really like to charge. He knows he's getting off cheap. But God have mercy on my soul if he ever gets huge with that book and I throw a tantrum that I didn't get paid enough. I had a choice. I made it. He liked it. The end.
desperation just to have your work out there
This is what I have the least compassion for. If you're so full of yourself that you think your work needs to go public at any cost, then you and a stingy writer are a perfect match.
Art is not a choice career if you want to make a living, it's not McDonald's where you apply in the urge to make ends meat. Art, from drawing over writing (fiction) to acting, is non-essential. You can't eat it, you can't heat with it, you can't drive in it, you can't cure disease with it. Which is why more people in any artistic/craft endeavor fail than succeed. So if you really think YOUR art is essential, well, don't fly too high with those wax wings and better take whatever exposure your ever so game-changing art is promised...
Artistic ambitions come from passion, or ego, or both. And if your ego is worth your working for free for a dude who may make millions off your work, then that's your problem and no client needs to feel bad for you having your Icarus moment. Hardly any young, aspiring artist will do commissions reluctantly, but rather fly head-first into them with enthusiasm. I think any client should be able to safely assume that the artist knows what they're doing, because the latter should be smart enough to know
their trade of choice.
Ultimately, artists who aren't depending on their art for money, do it for enthusiasm (or ego). If the artist is thrilled about the project and aware they're doing commercial work for free, why should the client feel bad? The artist had all the freedom in the world to explore what their options are.
Basically, it isn't any client's job to inform the artist about average rates and the like. The artist should be expected to know THEIR OWN TRADE and what THEIR OWN WORK is worth. If they do it for free without even thinking, then that's exactly what it's worth.
Art school isn't kindergarten. You're old and smart enough to make choices and inform yourself. Any decent art or design institution will also teach you about protecting your work, representation, and how to deal with clients.