What occurs in the real estate market when competing brokers conspire to fix commission rates?

When competing brokers conspire to fix commission rates, it constitutes price fixing. This practice involves competitors agreeing on pricing strategies rather than allowing market forces to determine commission rates based on competition and demand. Price fixing undermines the principles of a free market, leading to reduced competition, which can harm consumers by eliminating choices and keeping prices artificially high.

Price fixing is viewed as a violation of antitrust laws because it can create an inequitable marketplace where consumers may pay more for services than they would in a competitive environment. This behavior can lead to potential legal consequences for those involved, as regulatory bodies actively monitor and enforce laws against such activities to promote fair competition.

The other options relate to different aspects of market manipulation. Market allocation involves dividing markets among competitors, commission sharing refers to the legitimate practice of splitting commissions between agents for cooperative sales efforts, and buyer collusion would involve buyers conspiring to influence market outcomes, which is not the situation described in this question.