It used to intrigue me - back in the cosmetic's factory, we'd take this $0.75 piece of wax - lipstick, actually - and place it inside an expensive, $5.00 lipstick tube. Made no sense - a package more expensive than the actual product. Totally outrageous.
Until I was promoted to the sales floor. There, I was introduced to the marketing concept of "Sell the Sizzle, not the Steak". You see, customers have a much easier time of evaluating quality from the tube than the lipstick. And in reality, more so than the color, moisturizing qualities or staying power of the lipstick, the tube - the sizzle - sold the steak.
How does this relate to jewelry? Most people like me can't distinguish a $500 ring from a $5,000 ring. However, we can distinguish between a $1 and a $5