Forget the right-hand ring: for most women, the ultimate it's-all-about-me-baby! reward is the statement bag. (That, and killer heels, of course.) Designer bags garnered a lot of play during Sex & The City's heyday, and the effect hasn't worn off. What is it about designer bags that drives some of us to question whether that mortgage payment is really so important this month? And why are they so darn expensive? CanadianLiving.com decided to find out. Here's what we discovered.

You are (and aren't) paying for the name
The old yarn that "You're paying for the name" is both true and false. True, that is the bottom line: you're paying more for an Hermès bag because it's an Hermès bag. A designer brand costs more because it's a luxury product. As a consumer, you're most likely wanting the bag for its "ooooh"-appeal, and as one member of a designer purse forum put it, "You gotta pay to play."

Quality goods do cost more to produce
But luxury goods aren't luxury goods simply because someone decided "Luella Barton" was a more covetable name than "George." Designer goods earn the patina of "luxury" through their quality. Quality goods cost more to produce, and that's part of the expense that gets passed on to the consumer. Here are some factors that contribute to the high price tags:

• Specialized labour
The cheapest bags are mass-manufactured in countries like China where sweatshop conditions are the norm. Designer bags, meanwhile, are apt to be hand-tooled and stitched by well-compensated skilled craftspeople in places like France (Hermès, Louis Vuitton), Italy (Balenciaga, Gucci) and the United Kingdom (Burberry, Mulberry). Upshot: higher labour costs, steeper ticket price. The slower pace of production also means there are fewer of these products on the market, further driving up prices.

• The best materials
Top quality leathers (versus pleather or economy leather), expensive jacquard purse linings (versus cheap nylon) and real brass hardware (versus cheaper steel alloy or plastic) all add up.

• Original designs
A team of top established and up-and-coming talent from the fashion world work at each designer label, and the best talent gets hired for the highest price. Also, it takes a team of designers working for a renowned creative director/designer (say Marc Jacobs at Louis Vuitton and his own eponymous Marc Jacobs house) to produce an original collection. Meanwhile, if all you're doing is knocking off someone else's creation, as is often the case with cheaper bags, that requires minimal design talent. (And is, designers would argue, a form of intellectual-property theft.)

• Brand image and upkeep
Makers of designer bags often showcase their wares in splashy ad campaigns featuring top models or actresses, shot by in-demand fashion photographers, in ads running in top-tier fashion magazines, all of which costs a lot. This helps establish the brand's gotta-have-it mystique, but also contributes to the overhead. Additionally, given the glut of knockoffs on the market, luxury brands are fighting back with expensive lawsuits designed to keep imposters from capitalizing on their cachet (and, it could be argued, undermining their credibility with shoddy imposters). Louis Vuitton Moet Hennessy (LVMH), Louis Vuitton's parent company, for example, has a team of 60 anticounterfeit staff members as well as a cadre of lawyers. In 2005 and 2006 LMVH sued Google and eBay respectively over designer knockoffs being sold on their sites.

So, does all this mean you have to "pay to play" with rich celeb bag lady types like Uma Thurman, Lindsay Lohan and Victoria Beckham? Uh, no. With the array of affordable but non-knock-off bags available at major retailers, you don't. But hey, if your Lotto 6/49 numbers finally come in…

Read more:

What's in your handbag right now?

10 ways to dress smartly for less