That’s sad.
I would think the most likely explanation is that dog lost its owner and it had nobody to adjust the collar as it grew.
Your surmise about the loss of the owner is probably not even close. I suspect, and I’ve seen it before, that it is just plain neglect. If the collar is small enough to almost choke the dog to death, it means the owner collared it and let the collar stay in one position.
Once the embedding began, the owner was afraid to try and remove it, or worse, take it to a vet for removal...law enforcement might get involved.
So the owner most likely released the dog in another city and let it be someone else’s problem.