Implicit collusion, where players do NOT have an explicit agreement

Question

Quizplus · Accepted Answer

Implicit collusion, also known as tacit collusion, occurs when firms coordinate their behavior without explicit communication or agreement. While it can potentially lead to antitrust concerns, it is not strictly prohibited under antitrust laws. It is a form of cooperative behavior that can lead to higher profits for the firms involved, but it may also harm consumer welfare by reducing competition and keeping prices artificially high. Therefore, it does not necessarily maximize total surplus in the market.

Implicit Collusion, Where Players Do NOT Have an Explicit Agreement