This is the first book which deals with the economics of
diamonds, specifically with the determinants of diamond prices. The
period of analysis, 1978-1983, was chosen in order to shed light on
the dramatic drop in diamond prices. The dominant variables causing
this drop were the varying price of gold and fluctuating interest
rates. Khoury helps the investor in making long-range decisions
about investing in diamonds and deciding on the form the investment
should take. He warns of the importance to understand the
sensitivities of the market and the factors which must be taken
into consideration before commitments to an investment in diamonds
are made.
The book includes: a quick review of the characteristics of
diamonds, the financial performance of DeBeers in a declining
market, the economic structure of the diamond industry, the method
for exercising economic control over the diamond market, the
economic variables influencing diamond prices, and the modeling of
diamond prices and the testing of the model using advanced
statistical methods.
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