DP13925 The Herfindahl-Hirschman Index and the distribution of social surplus
|Publication Date:||August 2019|
|Date Revised:||December 2019|
|Keyword(s):||Consumer surplus, HHI, oligopoly, producer surplus|
|Programme Areas:||Industrial Organization|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=13925|
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.