Is diamond price higher than it should be? Are diamonds rare? Which model did the diamond industry use in old days to keep the diamond price high and make profit? (Tip: Collusion) What is the reason for the high price?

Diamonds' prices are a lot higher than they should be because diamonds are not rare. Diamonds are marketed as special gems who are a sign of love. This marketing strategy touts the scarcity of diamonds. After taking control of the large supply of diamonds in South Africa in 1930, De Beers, in an aim to get rich, changed the way diamonds were perceived. It used marketing to suggest that the diamond supply was small and created excessive demand by making diamonds the "go-to" gems for engagement and marriage rings.

Other companies involved in the diamond industry realized what De Beers was doing and colluded with the company in order to keep prices high and make profits.

As shown above, diamond prices are high because a false scarcity was created on the market; successful marketing strategies convinced people that "diamonds are forever" and people who love each other should not settle for anything less than a diamond when choosing special occasion jewelry.