Market commonality may lead to tacit collusion.

Question

Quizplus · Accepted Answer

Market commonality refers to the degree to which firms have overlapping products or services and are competing for the same customers. When firms have high market commonality, they may be more likely to engage in tacit collusion, which involves firms behaving in a manner that reduces competition without explicitly coordinating their actions. This can include things like matching prices or avoiding aggressive marketing campaigns.

Market Commonality May Lead to Tacit Collusion