Najaf in Iraq and Qom in Iran – the two preeminent centers of Twelver Shi‘ite legal education and learning in the world – are typically described as being in competition with one another. They compete for influence in Shi‘ite communities across the globe and to be the home for the most widely followed religious authorities. This paper further develops this market analogy by employing economic theory to offer a different interpretation of religious authority in Shi‘ite Islam. I argue that the relationship between Najaf and Qom is better analyzed as a particular form of oligopoly: a duopoly, a market structure in which two interdependent firms dominate. These two seminaries compete to prevent either of them from monopolizing Shi‘ite religious authority. But they also collude to 1) prevent the emergence or growth of other rival centers for Shi‘ite religious training, and 2) preserve clerics’ sole authority to extract religious rents from believers. Najaf and Qom respect the other’s “franchises” when their placement make it difficult for competitor seminaries (e.g., in Iran and Iraq, Lebanon, Syria, India, the U.K.) to gain market share, and they work together to suppress doctrinal or popular movements that might challenge the Usuli school that dominates Twelver Shi‘ism today. This collusive behavior in the religious marketplace for Shi‘ism stifles innovation and explains why no Shi‘ite version of salafism or influential neo-Akhbari movement has developed. The paper concludes by analyzing how the deregulation of religion in Iraq, demographic changes, and imminent transitions within each of the leading “firms” (i.e., the looming successions to Sistani and Khamenei) might lower the barriers to entry in the religious marketplace of Shi‘ism. This could lead to greater differentiation between religious training in Najaf and Qom and a general weakening of clerics’ religious authority and privileged access to rents, increasing the diversity of Twelver Shi‘ite Islam.