Herfindahl-Hirschman Index (%)

{
  "id": "MLC-T-ECS-000871",
  "term": "Herfindahl-Hirschman Index (%)",
  "field": "Economic statistics",
  "definition": "The Herfindahl index (also known as the Herfindahl-Hirschman Index or HHI) is a common measure of industry concentration. The index is calculated as the sum of squares of the market shares of a fixed number of the largest firms within an industry, where the market share of a firm is expressed as a percentage of a firm's sales, value of shipments, or revenue in relation to the industry total. The equation below shows how the index, using the n largest firms within an industry, is computed:\n\n• HHI(n) = sum(Si^2)\n\nwhere Si is the market share of the ith largest firm within an industry.\n\nIn these tables, the index is calculated using the 50 largest firms (n = 50). Possible values of HHI range from near zero (if every firm in an industry has the same market share) to 10,000 (if all sales, value of shipments, or revenue in an industry are contained within a single firm). Thus, large values of the index indicate more concentration within an industry, smaller values less.",
  "references": [
    "U.S. Census Bureau Glossary"
  ],
  "url": "https://mlchart.com/terminology/economic-statistics/herfindahl-hirschman-index-percent/"
}