Price Leadership:

In this form of collusion, one firm sets the price and the rest follow. This helps to reduce the uncertainty about the competitors' reactions, even though the firms may have to depart from their profit maximising position. Price leadership is more widespread than cartels because it allows the members complete freedom regarding their product and selling activities. Such an arrangement is more acceptable to the followers than a complete cartel, which requires the surrendering of all freedom of action to the central agency.  

There are various forms of price leadership. The most common types are:

1) Price leadership by a low-cost firm  

2) Price leadership by a large (dominant) firm

3) Barometric price leadership.

In this kind of a setup, the leader sets it's price according to the marginalistic principle (MR = MC) and the followers merely act as price takers. Generally, therefore the followers do not end up maximising profit. If they do so then it is by sheer coincidence and not an outcome of their independent decision.