I know that HHI of 1000 -1800 is “moderately concentrated” also if HHI goes up by more than 100 after merger, and HHI is between 1000 and 1800, then it will be opposed by regulators can someone please help me with other HHI information what does HHI mean if it is below 1000? anything else?
You have it down. Less than 1000 would just mean that the industry is not very concentrated. I think the important things to know are the calculation (sum of squared mkt shares of all), >1000 or a change of 100 will be heavily scrutinized, and 1800 is highly concentrated (doubtful that a merger would be approved).
If it’s more than 1800 and change >= 50, definite challenge.
i just want to get this straight: if HHI after merger is > than 1800, if the HHI increased by more than 50 it is a challenge? but between 1000 - 1800, it has to increase by more 100 to be challenged? ------ also low HHI is … basically bad, fragmented industry? is that correct?
Low HHI - competitive industry I think i.e. not concentrated. Low HHI is a good thing…
ok I’m confused (not the first time) First: is HHI the same or similar to HI? Herfindahl INdex? With the Herf Index we want it to be high, high HI means the industry is not fragmented, more oligopolistic ---- What is the difference between HI and HHI?
They’re pretty much the same thing. HHI uses the market shares in % form and the HI uses them in decimal form. I’m not sure why though…someone else can chip in here to help?
I would hold off on whether Low HHI is a good thing. Would probably depend on who you are. You may want your suppliers to be in a competitive industry, but I would want to be a monopoly. As consumers, competition is great as it lowers prices.
CFAtime Wrote: ------------------------------------------------------- > They’re pretty much the same thing. HHI uses the > market shares in % form and the HI uses them in > decimal form. I’m not sure why though…someone > else can chip in here to help? to confuse the **** out of us
Between 1000 and 1800 with >100 change means a possible challenge, not definite.
i believe the herfindahl is only the top 50 firms while the HHI is ALL firms an industry. i might have those two mixed up but the basic premise is the same