If a proposer reneges, then you'll own the ring:

http://en.wikipedia.org/wiki/Engagement_ring#Legal_ownership

By then it's too late. The point is not to get more out of it if things go south. The point is to make sure they don't. This is basic game theory, buddy.

Perhaps I should have been more verbose. The point I was trying to make is that neither proposer is more likely to renege. Since they have both given away their 25k investment, it doesn't matter to either of them what the resale value is and thus it has no impact on their decisions. Unless it's assumed that you'll be combining assets upon marriage, which I hadn't taken into account in my original post.

Since you'll have to decline one of these proposals, one of them gets their ring back. Which one are you more likely to accept? All things equal, the 20k resale ring.

Why would two people propose?

LMAO

The one with better romantic prospects, obviously.