A term that describes the phenomenon of the market price of goods essential to life, like water, being way lower than that of goods that are non-essential, like diamonds. It is also called the diamond-water paradox. Even though water is much more valuable to life than diamonds, its abundant availability — as compared to diamonds — causes its marginal value to buyers to be lower than that of diamonds. Hence, water usually costs much lesser than diamonds, unless there is a huge scarcity in its availability. In that case, both the marginal value and price of water would be way higher.
