Airlines basically sell the same bit of space twice and both passengers feel like they ‘own’ it. This is done on purpose. If you’re annoyed at the passenger in front of or behind you then you’re not finding things to be annoyed at the airline about.
This is not the main reason. It’s simply so they can pack more people in – that’s it. No psychology required. Packing more people in obviously saves money, but that subsequently makes the fares cheaper for us, AND it saves carbon, so don’t jump onto your high horse too soon.
Regarding the OP I think it would take much longer to get everyone on and off a plane if they were all lying down.
No one should be able to recline, problem solved. However that would give me the chance to moan about other issues with the flight.
Having been on planes without reclining seats, your main moan would be ‘why are these seats so **** uncomfortable?’ Why don’t you try leaving your seat upright on your next long haul flight, see how you get on?