The Herfindahl-Hirschman Index and the Distribution of Social Surplus
31 Pages Posted: 7 Oct 2019 Last revised: 13 Jan 2020
Date Written: August 2019
Abstract
I show that in a broad range of oligopoly models where firms have (not necessarily identical) constant marginal cost, HHI is an increasing function of the ratio of producers' surplus and consumers' surplus and therefore reflects the division of surplus between firms' owners and consumers.
Keywords: Consumer surplus, HHI, oligopoly, producer surplus
JEL Classification: D43, L41
Suggested Citation: Suggested Citation
Spiegel, Yossi, The Herfindahl-Hirschman Index and the Distribution of Social Surplus (August 2019). CEPR Discussion Paper No. DP13925, Available at SSRN: https://ssrn.com/abstract=3464444
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