Legal Definitions - conscious parallelism

Definition: Conscious parallelism is when businesses change their prices to match those of their competitors in a market without communicating or colluding with them. This is different from price-fixing, which involves an agreement between competitors and is illegal. Conscious parallelism is not illegal on its own, but it can have harmful effects similar to price-fixing.

For example, if all the shipping companies increase their package rates by 15% after the U.S. Postal Service does so, without ever speaking with employees of the Postal Service, this would be an example of conscious parallelism.

Businesses in very competitive markets, such as airlines, often engage in conscious parallelism to stay profitable. However, critics argue that this behavior can lead to higher prices for consumers and reduced competition in the market.

It's important to note that while conscious parallelism is not illegal on its own, other evidence in combination with conscious parallelism can lead to a charge of collusion.