how did the de beers cartel try to maintain control of the price in the diamond market __________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
Answer:
The De Beers cartel tried to maintain control of the price in the diamond market by using various tactics such as:
1. Controlling the supply: The De Beers cartel controlled the supply of diamonds in the market by buying diamonds from other mines and stockpiling them. This helped them regulate the quantity of diamonds in the market and maintain prices.
2. Creating an illusion of scarcity: The De Beers cartel also strategically released diamonds into the market to create an illusion of scarcity. This created a perception that diamonds were rare and valuable, and people were willing to pay more for them.
3. Marketing: The De Beers cartel invested heavily in marketing to create a demand for diamonds. They created the famous slogan “A diamond is forever” to convince people that a diamond was a timeless and valuable investment.
4. Controlling distribution: The De Beers cartel also controlled the distribution of diamonds by only allowing authorized dealers to sell diamonds. This helped them control the supply chain and maintain prices.
5. Price fixing: The De Beers cartel also engaged in price fixing by setting a minimum price for diamonds. This prevented competition and ensured that prices remained stable.
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