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Some is for show. Some is drop dead outstanding steel. Most is sold for its looks I suspect. The argument for damascus is that you have a steel combining the qualities of a very hard, wear resistant steel sandwiched between layers of a softer more flexible steel. They each perform their intended functions while protecting the other's weaknesses. One is very hard, protecting the softer flexible steel from wearing away. The other is flexible, protecting the harder steel's brittleness. Damascus is nice to work with and easy to sharpen. It is very elegant on an upscale art knife yet very appealing in a primitive style knife.
Is it outstanding steel? That depends on who is making it and how good a using steel they want it to be. Good damascus, made by an excellent bladesmith, is arguably the best steel there is. Period! It will sustain abuse and pass torture tests that would leave homogenous steel blades in little bitty pieces. And that is coming from a stock removal method knifemaker who mostly uses homogenous steels. (the operative word there is "mostly")
Damascus sure looks better but I've read articles were some top makers say that the best damascus (properly made and heat treated)is only as good as good carbon and tool steel.There is also much more room for error with damascus.