Why The Perception of Value is Just as Important as Actual Value

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What is The Scarcity Principle?

In psychology, the Scarcity Principle describes the urge to purchase, gather, or obtain something that a person feels that they may not be able to get in the future. Part of this urge stems from the need to ensure we have what we need to survive. We also tend to value things either rare or that we cannot have, but the pleasure principal also addresses the need to feel in control. By obtaining something that is difficult to get we demonstrate an ability to control our environment. This need to control is not just about self-worth, but also about “keeping up with the Jones’.”

The Perception of Value is Just as Important as Actual Value

In post-war Japan, it was illegal to important diamonds until 1959. Diamonds were not highly prized by the Japanese as it was not a part of Japanese tradition to give diamond engagement rings.

But in 1968 ad campaigns depicting thin, attractive Caucasian women wearing diamond rings flooded Japanese magazines. The ads conveyed the message that women who had diamonds epitomized western wealth.

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