Essay about The Price of Diamonds Is Too High

For centuries, diamonds have been regarded as one of the most valuable commodities in the world and the industry has evolved into billions of dollars. At the top, De Beers dominated the entire industry worldwide, from exploration to retail selling. However, it has a reputation of a monopolist, where it influences supply and demand. The two critical factors that De Beers carefully maintained throughout the century to remain in monopoly was to create the illusion of the scarcity of the diamonds and to keep the prices high. Realizing the benefits of the cooperation and the dangers of the oversupply, most

- 1937 De Beers stockpile of diamonds had grown to 40 million carats (20 years supply).

At the time I checked, there where 771002 listings under natural diamonds. As the number of the seller increases, the supply of these diamonds increases as well. McConnell, C., Brue, S., & Flynn, S. (2012) explains that ““A shift to the right, as from S 1 to S 2 in Figure 3.5 , signifies an increase in supply” (p. 53). This is exactly what would happen in this case because as the supply of the diamonds goes up , the curve will be shifted to the right, and will also decrease prices. As more members join eBay.com it means that there are more buyers and this will automatically increase the demand of these goods as well. Also explain on (p.50) on the McConnell text.

Diamonds bought very frequently. Diamonds are the ultimate luxury. A cut in price wouldn't increase demand very

It was the marketing campaign of the De Beers Group that have made diamonds as popular as they are now.

1) The competitive forces confronting Blue Nile and other online retail jewellers are medium or weak in strength, with the exception of the strong rivalry between sellers. The potential for new entrants to the jewellery market is relatively low due to the high costs of inventory, the lack of differentiation of product and the brand recognition held by the industry leaders. Good substitute products for a quality diamonds are not readily available. There are synthetic gemstones, cubic zirconium and other jewellery options, but the general consumer does not see these as a true substitute for real diamonds.

The Kimberley Process Certification Scheme, popularly known as KPCS, is a practice formed to validate the derivation of rough diamonds from resources which are free from conflict fueled by diamond fabrication. This procedure was launched in 2003 to avert diamond sales from financing mutinous engagements. The certification scheme’s goal is to stop these “blood diamonds” from entering the conventional rough diamond market. It was designed to reassure consumers that by purchasing diamonds, they were not contributing to war and the violation of human rights.

Situation: DeBeers Consolidated Mines Limited (DBCM) occupies a major presence in the diamond industry. Discoveries of diamonds in the late 1800s were pioneered in South Africa, in which DeBeers held a heavy monopoly over. Since then, they have cultivated an impressive track record and leadership position. The Central Selling Organization (CSO) controls and regulates the flow and sale of rough diamonds, and was acquired by DeBeers in the 1930s. Due to a stable economy both locally and internationally, DBCM was the world’s largest producer and distributor of diamonds in late 1998. However, just before the turn of the century, globalization and developments in international

I have chosen to focus on and analyze one pattern of the Diamond Trade at a global scale. The pattern illustrates that the Diamond Trade exists on a global scale. I have used examples and specific evidence from different regions and nations across different hemispheres to highlight this Global pattern. 

There are five different processes of the Diamond Industry. Exploration, mining, selling rough diamonds, cutting and polishing and selling on world markets. Each process happens in different location from the previous process. Producing a diamond with these different processes and locations causes one big spacial pattern. 

Exploration is a very early process of the Diamond Trade. Exploration is testing certain areas to determine the

In the same light, if the price varied vastly between companies, people would be able to purchase from the company that charges less, resulting in people losing their appreciation of the product. A threat to the company came about in the 1950s when diamonds were discovered in Siberia, and although these diamonds were of a somewhat inferior quality to the ones sold the company De Beers, these cheaper diamonds would lead to a decrease in the quantity of De Beers’ diamonds demanded. Therefore, De Beers bought up almost every diamond from Siberia, meaning that it owned the vast majority of the diamonds of the world. Price fixing and output restriction were the next step to ensure that diamonds do not lose their value to the world.

Diamonds are the most expensive and beautiful jewels in the world. Throughout the mankind’s history these desirable, exceptional, and alluring gemstones have been attracting much attention. Uncut stones decorated the armor of knights and faceted ones embellished the crowns of royal persons. The owners of diamonds were adored and envied as crystals were sparkling on noble ladies and fascinated all the people around them. Nowadays, diamonds are viewed not only as symbols of love and betrothal, but also as profitable object of investment. The first such gemstones were found in ancient times in India. However, people do not know the exact date of their discovery. At the beginning of the Renaissance period diamonds appeared in Europe with great

De Beers SA, the world's largest diamond miner and marketer, was established by Cecil Rhodes and Charles Rudd when diamond was unearthed in Africa in the year 1886. Through the year of business changes and tabulation which makes today, De Beers is the leader in the diamond industry with an approximately US1.4 million of revenues. However, behind every success come with a price. Apart from the successful business practices, it was accompanied with positive and negative approaches. Shown below are the review and analysis.

Price: Price is another factor that is key to diamond industry. Price runs parallel to the quality of the diamond. Higher the quality of the diamond the more would be the price.

Color. Clarity. Cut. Carat Weight: These four words are what jewelers in the industry use to determine the monetary value of a diamond. However in 1947 De Beers found a way to not only boost their sales but also make a psychological necessity out of this sparkly stone, and it all began with four vastly different words, “A Diamond Is Forever” (Frances Garety), and accompanied by phrases such as “Isn’t two months’ salary a small price to pay for something that lasts forever (N.W. Ayers)?

3. Description of the IMF Project to Help Africa Crack Down on Illicit Diamond Trade