How are similar and duplicate filters related?

Is one a watered down version of the other?

[jetboy_70]

"In order to show you the most relevant results, we have omitted some entries very similar to the n already displayed. If you like, you can repeat the search with the omitted results included."

Would I be right in assuming that Google uses a similar algorithm to ascertain what constitutes a 'similar' page as it does a duplicate page?

As Google seems to be tightening the screws on what constitutes duplicate content, could the similar page filter be considered an early warning of possible duplicate content issues?