Collusion is more likely to occur when
A) there is fear of punishment for not colluding.
B) there is a known finite time horizon.
C) there are large gains to be made by cheating on an agreement.
D) the game lasts only one period.

Question

Quizplus · Accepted Answer

Collusion is more likely when participants fear punishment for not adhering to the collusive agreement, as this fear can enforce discipline among the colluders and sustain the collusion over time.

Collusion Is More Likely to Occur When