4th dan = master, thats the TKD way
Different goups do rank differently, sometimes VERY differently.
My guess is that it is a marketing thing to some extent. And a very good one at that. General public assumes that 4th dan is better then 2nd, and master is an important title. So let's give those titles to lots of people.
It's not just tkd that has done this, it happens across the board, and it DOES work at promoting the style, which at the end of the day is probably more important then how many stripes are on someones belt.
Now grade inflation gets a lot of criticism, but I don't think they are really justified. Let's suppose you got a brown belt in BJJ, has been training for 7 or 8 years, and you got a 3rd dan black belt in TKD with equivelant training. Now suppose you know very little about styles and ranking standards, who are you more likely to train under?
Ok, now suppose that both occupy the same spot on the "Who is qualified to teach" list. In other words no brown belt in TKD would be teaching. It's not really the standards that shifted, just the colors associated with those standards.
Even within the same art, suppose you study pingu ninpo
school A
requires 1st dan to start teaching.
1st dan takes 7-8 years
School B
requires 3rd dan to start teaching.
2nd dan takes 7-8 years
3rd dan takes 8-10 years
Now when it comes to standards of teachers, who's got the higher standards? Thats right, the place that hands them out quicker. Now let's also call them master at that level, just for fun
Next question, who will get more students in the door? Well, if they do the same marketing and all that other stuff, the person with the higher rank will as it sill be assumed to be better.
And last question, who will retain students LONGER, which is a lot more important then who will promote more to black belt.
My guess would be the ones that promote more often, and enforce that black is not "the" goal, just one. The more that first black means the less their is to keep people after they get it.
Anyways.... bit of a different path then the original topic...
But basically it comes back to the original topic in that it is all about business. And like it or not martial arts clubs are businesses, if the bills don't get paid the training doesn't happen.
So if competing has a chance at hurting an instructors business if it doesn't go well, they're not gonna compete. Of course this has a lot to do with how that business is set up and presented to the students.