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In "The Necklace," the internal conflict lies in the fact that Madame Loisel is embarrassed by her poverty. However, that internal conflict is caused by an outer, social struggle of class conflict.
While she is physically beautiful, and married to an understanding husband, she believes that the key to her happiness lies in expensive necklaces, balls and the luxuries that come with being rich. You can't blame the poor for wanting to be better off, or wanting to be rich for that matter. So, this story is certainly a statement about class consciousness and the internal struggles that are caused by societies with rigidly defined class structures.
That being said, the internal struggle, Madame Loisel's, is partly her own construction. Sure, one can sympathize with her desire for a more comfortable lifestyle. But she is obsessed with the idea that rich people are generally more happy and she's obsessed with how other people see her. Therefore, she augments her internal conflict because she is unable to find happiness in her own conception of herself and in the joys of life that have nothing to do with money or the culturally constructed, and therefore "made up," images in the heirarchy of social positions.
The internal conflict in "The Necklace" stems from the class structure under which Madame Loisel lives and her false pride. For Madame Loisel desires to be among the haute bourgeoisie, a level of society to which she feels she should belong.
Without a dowry, the pretty and proud Matilde Loisel has had to marry a minor clerk in the Ministry of Education. However, she remains dissatisfied.
She grieved incessantly, feeling that she had been born for all the little niceties and luxuries of living.
She is distressed by the poverty of her dwelling with its unsightly draperies, the worn-out upholstery on the chairs, and the lack of the small "niceties and luxury of living."
When she attends the evening reception at the Ministerial Mansion, Matilde Loisel feels that she is among members of the class to which she should belong. Under the admiring glances of the upper class gentlemen, she is "wildly drunk with pleasure." But, after her Cinderella evening is over, she discovers that she has lost the necklace that her wealthy former classmate has lent her.
Too proud to admit to Mme. Forestier that she has lost this necklace that she believes to be composed of diamonds, Mme. Loisel shops for a necklace that can replace it. For the price of the necklace that she and her husband find, M. Loisel must sacrifice his inheritance of eighteen thousand francs and borrow the same amount.
After years of deprivation and humiliation the Loisels pay their debt, but the conflict within Madame Loisel is not resolved because she, then, is reduced to the lowest class and suffers even more humiliation and resentment as a result. Then, when she finally sees Mme. Forestier on the Champs Elysees, she blames this wealthy woman for her hardships:
"I've had a hard time since last seeing you. And plenty of misfortunes—and all on account of you!"
The ironic twist to this struggle is that Madame Loisel would not have had to endure the misery that she has were she open about losing the borrowed necklace in the first place.
The external conflict resides in the class struggle of Mme. Loisel. She is a beautiful young woman of the petite bourgeoisie who could have married a man with a high social position if she were to have possessed a dowry. And it is her longing to be among the haute bourgeoisie that effects her compelling her husband to purchase an evening gown for her and, later, to go into terrible debt by purchasing what they believe is a replacement necklace, so that her wealthy friend will not know that she has lost the necklace loaned to her.
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