Thursday, February 20, 2020

The Herfindahl-Hirschman Index and the distribution of social surplus

By: Spiegel, Yossi
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.

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