Getting an ROI through your PPC campaigns

I'll be honest, I do participate in click arbitrage.  Click arbitrage is defined as buying a click at a lower rate than you can sell it at.  Obviously you don't actually "sell" the click, but you convert that low price click into a higher paying click or sale.

For example:

I can buy clicks for a blue widget for $1 each.  I make $10 per widget sold, and I have a 30% conversion ratio.

With my current situation, I can buy 10 clicks and make $30. That $30 cost me $10 in clicks (10 clicks at $1 each).  That is essentially click arbitrage.

Click arbitrage doesn't just apply to affiliate programs.  Think about this:

I have a website about widgets.  Clicks on my website generate an average of $.50 per click.  I can then go to AdWords and buy a single click for $.05.  If 50% of my visitors (calculated per unique visitor) click an AdWords as then I am buying lower than I am selling back to Google.

$.05 per click paid.  $.50 per click earned.  50% CTR on my website.

For every 100 clicks I will pay $5 and make $25 at a 50% CTR.

Obviously ratios like this are hard to find, but it is possible for some small niches.  The problem them becomes getting a high enough volume of clicks to make it worth it to manage the campaign.

Is this wrong?  Isn't this just playing the middle man and buying low and selling high?

Isn't that what they teach in every business course around the world?

What do you think about buying clicks and selling them back?