Competing on price is a losing game. The customers that want a cheap price will be the most work and hassle. They simply don't value the product or you i.e. "Why should I pay someone much to type for a few hours?"
It's not intuitive, but raising your price will signal that you and your work are more valuable AND you will get more and better customers. Consider this: when you shop for something (that you don't have a lot of knowledge about) I bet you use the price as one indicator of quality. Same for services: Your customers will think "If he can charge $XXX hour, he must be good."
It is so common to devalue your own abilities as developer that it is a cliche' (Google "imposter syndrome"). In reality, your ability to deliver real value to a business/client happens long before you consider yourself an "expert".
I have 2 rates. (1) Free (2) Full price. In my experience, customers don't appreciate introductory discounted rates. Instead, they feel ripped off when you start charging them the full rate.
I don't have time to find the links now but HN'er Patrick McKenzie "Patio11" has written great stuff on this. See his blog on Kalzumeus Software.