There are a few factors at play. The law of diminishing returns certainly applies. Paying double the money doesn't get you twice the rod. Then you can look to the case where cheap doesn't mean nasty any longer, or at least nothing like it did twenty years ago.
However, a rod not snapping in use isn't a true measure of how good a rod is. Many cheap rods are actually less likely to snap, even under abuse, than a top quality rod.
You then need to consider whether the user can actually tell or appreciate the differences between a budget rod and a top end rod. Many can't, and that's fine, makes it a cheaper experience for them. This is equally applicable to all sorts of gear, from hi-fi to PCs.
Another thing to be aware of is the brand premium. There's no doubt in my mind that broadly similar performing items can be had for quite different prices, depending on the logo on the side. However, as before, that's no different from any other branded consumer item.
Longevity also comes into the equation. I'm content that, when buying higher end kit, it generally lasts longer. Until fairly recently, the vast bulk of my gear was good stuff of fifteen to twenty year vintage. Most of it was still going strong and there was no need to change, only a desire to. Most of the old stuff (Daiwa match rods and the like) went to a mate that tends to buy at the lower end of the market. He was stunned at just how good seemingly old kit was compared to budget modern stuff. There's also the fact that such gear, despite being so old, still retains a fair amount of its initial value. That isn't going to happen with budget gear. I'd also suggest that many folks operating at the budget end of the market actually end up spending far more on gear than those spending big every ten years or more.
It's also worth considering future desireability and value. Rods I paid around £120-150 for in the early nineties are still worth £50-100 (provided they are kept in decent condition). A rod you pay £50-75 for now is going to be worth £25-50 before you even use it and even less by the time it's a year old or used. A rod you pay £30 for now is likely to be all but unsaleable the instant you buy it.
The bottom line is this, you pay your money and take your chance.