Question

what is the impact of explicit and tacit collusion in the wider market

Answer 1

Both Explicit and tacit collusion are deterimental to the overall market efficiency where the explicit collusion is in the form of Cartel like OPEC ,Tacit collusion is to avoid the stuck from regulators is prevalent in Duopoly but both these collusion tactics reduces the Consumer welfare and surplus, increases the price for consumers, lesser than efficient output is supplied, barriers to entry for new entrant in accojnt of collusion tactics, Reduces innovation and development of the industry also leading to decreased productivity.