Collusion and Market Structure
Explain what economists mean by collusion and consider the view that collusion will occur only in a certain type of market structure.
Market Structures and Competition
CIE A Level October/November 2022
- Definition of collusion.
- Initial consideration of the view that collusion occurs only in certain market structures.
⏩II. Understanding Collusion⏩
- Further explanation of collusion.
- Different forms of collusion⬅: formal and tacit.
- Conditions that favor collusion.
⏩III. Collusion in Different Market Structures⏩
- Analysis of the occurrence of collusion in different market structures⬅: Perfect competition, monopolistic competition, monopoly, and oligopoly.
⏩IV. Emphasis on Oligopoly⏩
- Discussion on why oligopoly market structure is most likely to promote collusion.
- Limitations and competition within oligopoly.
- Recap of the argument and response to the view that collusion occurs only in certain market structures.
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