Are Diamonds Really Forever? A Study of the History and Future of the Diamond Industry

Open Access
Author:
McGillian, Allison R.
Area of Honors:
Economics
Degree:
Bachelor of Arts
Document Type:
Thesis
Thesis Supervisors:
  • David Shapiro, Thesis Supervisor
  • Bee Yan Roberts, Honors Advisor
Keywords:
  • diamonds
  • diamond industry
Abstract:
Diamonds have long been a subject of economic intrigue due to the unique nature of their value. While diamonds offer very little consumption benefits, they are prized as status symbols and thus command a high value in trade. Essential to the diamond market is the cultivation of demand for the stones, which has been carefully controlled by the international diamond cartel since its inception in the early 20th century. This industry goes to great lengths to control supply and manipulate demand in order to convince the public at large of the rarity of these precious stones and thus maintain high and stable prices. Essential to these efforts are the psychological processes involved in maintaining the perceptions of the public. This thesis will examine the past, present, and future of the diamond industry, with specific emphasis on the measures taken by the industry to influence consumers' psyche.